Newmont Moves to Placate Investors -- WSJ
March 26 2019 - 2:02AM
Dow Jones News
By Alistair MacDonald
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (March 26, 2019).
Newmont Mining Corp. will issue a special dividend in an effort
to quash shareholder dissent that threatened the company's takeover
of Goldcorp, a deal that will create the world's largest gold
miner.
Two large Newmont shareholders said last week that the company's
$10 billion merger with Goldcorp transferred significant gains away
from a recently announced Nevada joint venture between Newmont and
Barrick Gold Corp. The January merger deal was struck before the
Nevada agreement.
On Monday, Newmont said it would pay 88 cents a share to its own
investors if the Goldcorp deal is approved by both companies'
shareholders next month.
The move reflects feedback from investors, Tom Palmer, Newmont's
chief operating officer, said in an interview. "The special
dividend allows us to pass on the full after-tax synergies that
would have gone to the Goldcorp investors," he said.
Newmont estimates that the Nevada joint venture will result in
cost savings of $4.7 billion, but those savings will be split
between Newmont and Barrick shareholders.
Paulson & Co., a major Newmont shareholder, said the
dividend is a step in the right direction and it will no longer
oppose the merger. The hedge fund sent a letter to Newmont Chief
Executive Gary Goldberg last week saying the Goldcorp deal needed
to be renegotiated. Investment firm VanEck, one of Denver-based
Newmont's largest investors, backed that sentiment several days
later.
Goldcorp declined to comment.
Investors also have criticized the size of postdeal compensation
for Goldcorp's current chief executive and its chairman.
Mr. Palmer said this was a matter for Goldcorp, which didn't
immediately respond to a request for comment.
--Jacquie McNish contributed to this article.
Write to Alistair MacDonald at alistair.macdonald@wsj.com
(END) Dow Jones Newswires
March 26, 2019 02:47 ET (06:47 GMT)
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