LONDON (ShareCast) - (Sharecast News) - Newmont Mining has agreed to buy Goldcorp in a $10bn that would create the world's leading gold business.
Under the terms of the deal, which has been unanimously approved by the boards of directors of both companies, Newmont will buy each Goldcorp share for 0.3280 of a Newmont share. Newmont shareholders will own around 65% of the enlarged entity, while Goldcorp shareholders will own the rest.

Newmont said the deal will give unparalleled leverage to the gold price given the combined company's scale, and offer a world-class portfolio of gold mining operations and projects in favourable jurisdictions.

In addition, it will offer shareholders tteady, profitable gold production targeting 6 to 7 million ounces over a decades-long time horizon, a solid, investment grade balance sheet and a targeted sustainable annual dividend of $0.56 a share - the highest among senior gold producers.

Newmont's chief executive producer, Gary Goldberg, said: "We have a proven strategy and disciplined implementation plan to realize the full value of the combination, including an exceptional pool of talented mining professionals, stable and profitable gold production of six to seven million ounces over a decades-long time horizon, the sector's largest gold reserve and resource base, and a leading project and exploration pipeline.

"The combination is expected to be immediately accretive to Newmont's net asset value and cash flow per share. We constantly review opportunities to raise our performance, and this combination represents the most promising path to deliver superior and sustainable value for our shareholders, employees, host countries and communities."

RBC Capital Markets said: "We believe this second combination of two senior global gold producers, following the Barrick-Randgold merger announced in September 2018, could delay further M&A among senior and intermediate gold producers as companies seek to acquire non-core assets expected to be sold by Newmont Goldcorp and new Barrick."

At 1430 GMT, Goldcorp shares were up 8.9% to $10.55, while Newmont was down 6.2% at $32.71.

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