Newcrest investors approve Newmont merger

afr.com:

Shareholders in Australia’s biggest gold miner, Newcrest, have overwhelmingly voted in favour of a $26.2 billion merger with US gold mining giant Newmont.

Almost 92 per cent of shareholders voted to support the deal via proxy votes lodged before the meeting on Friday, five months after Newmont improved a scrip offer that values Newcrest shares at $29.29 – almost double the $15.81 the stock fetched in September last year.

Newcrest chairman Peter Tomsett and Newmont CEO Tom Palmer.  

The acquisition of Australia’s biggest gold miner will extend Newmont’s lead as the world’s biggest gold company. Two existing Newcrest directors will join the Newmont board as part of the merger “but they haven’t been decided”, Newcrest chairman Peter Tomsett told the shareholder meeting.

Mr Tomsett told reporters after the meeting that he would not be nominating for a seat on the board.

While the majority of shareholders voted in favour of the merger, some retail investors pointedly asked Mr Tomsett why the board had decided to sell the company to a foreign investor.

“It’s interesting, the pride in Australian independence and ownership of resources, it’s a thing we’d love to have. We’ve loved being an Australian champion of the gold industry,” Mr Tomsett said. “The reality is that we were made an offer from Newmont we couldn’t resist.”

The exact value of the deal will fluctuate with the market price of the Newmont shares that will be issued to Newcrest shareholders. Newmont stock last traded at $US38.78 on the New York bourse. Newcrest shares have traded 2 per cent higher to $25.81 since Thursday.

Under the merger deal, each Newcrest share will be exchanged for 0.4 Newmont shares, issued as stock quoted on the New York Stock Exchange, CHESS