Newmont Boosts Its Offer to Buy Newcrest to $19.5B

Heavy equipment in gold mine

Bob Riha Jr / Contributor / Getty Images

Key Takeaways

  • Newmont (NEM), the world's largest gold miner by market cap, increased its bid to purchase Australian firm Newcrest.
  • Under the new proposal, Newcrest investors would hold a 31% stake in the combined company.
  • Newmont indicated that, beyond improving its gold portfolio, the deal would boost its copper production.

Newmont (NEM) sweetened its offer to buy Australia's Newcrest Mining in what would be the biggest acquisition ever in the gold mining industry.

The new proposal of $19.5 billion came after Newcrest rejected Newmont's previous $17 billion bid in February. Under what Newmont calls its "best and final" offer absent a superior one, Newcrest investors would hold a 31% stake in the combined company.

Newmont CEO Tom Palmer said that mining companies are "entering a new era" in which they must hold themselves to a higher standard of sustainability and long-term value creation. He added that this transaction would make Newmont "well-positioned to generate strong, stable, and lasting returns with best-in-class sustainability performance for decades to come."

Adding Copper

Newmont pointed out that, along with boosting its gold portfolio, acquiring Newcrest would increase its annual copper production and add almost 50 billion pounds of copper reserves and resources.  

Newcrest said that it has agreed to give Newmont the opportunity to conduct confirmatory due diligence to enable it to put forward a binding proposal. It indicated that should take about a month. 

Newmont is already the world's largest gold mining company by market capitalization at $40 billion, while Newcrest is valued at about $18 billion. Shares of Newmont fell 2% on April 11 but are up 5% this year.

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
  1. Newmont. "Newmont to Enter into Confirmatory Due Diligence on Newcrest."

Take the Next Step to Invest
The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.