Barrick Gold corp. has reportedly proposed around 17.85 Billion US Dollars on Monday, as a deal to merge with the rival firm, Newmont Mining corp.
According to the President and Chief executive officer at Barrick, Mr. Mark Bristow: “The combination of Barrick and Newmont will create what is clearly the world’s best gold company, with the largest portfolio of Tier One Gold assets and the highest level of free cash flow to drive future growth and support sustainable shareholder returns, run by a management team with an unparalleled record of delivering value.”
Newmont reported a 10 Billion US dollars all-stock offer back in the month of January with the competitive firm named as the Goldcorp Incorporation as an intention of forming the largest gold miner across the globe. The Bristow is also actively encouraging the Newmont to reject this offer and agree to merge with the Barrick. According to Barrick, collaboration in the form of a merger with Newmont would be allowing them to make around 7.5 times more yearly synergy levels than the yearly synergy levels that are mentioned in the Newmont’s deal with Goldcorp.
The proposed exchange ratio in the deal is that for every Newmont share, there are 2.5694 shares of Barrick. The stockholders of Barrick would have the ownership of about almost 56 percent of the share of the merged company while the Newmont shareholders would have the ownership of the rest. The newly formed firm would have the same annual dividend of Newmont of around 56 cents for every share.
The Newmont’s Board of Directors received a letter from Barrick which said that the accomplishment of this merger within the two firms would be relying upon the fact that Newmont refuses to agree to the merger with Goldcorp.
The last high-profile merge by the firm was last year in September when they decided to purchase the Rand gold Resources Limited. Ever since that acquisition, the Randgold and Barrick combo has been able to generate more than 5 billion US dollar for the Barrick and Rand gold’s shareholders combined.