Newmont Mining to pay special dividend if Goldcorp takeover approved
DENVER – Newmont Mining Corp. is offering a special dividend to its shareholders if its friendly takeover of Goldcorp Inc., which has faced opposition, wins shareholder approval.
The gold miner will make a one-time payment of 88 cents per share, conditional on the approval of the deal by both Newmont’s and Goldcorp’s shareholders, the Colorado-based company announced Monday.
Hedge fund giant Paulson & Co. Inc., which holds 14.2 million shares in Newmont, said last week that it didn’t support the current Newmont bid for Goldcorp – citing several reasons.
Among other things, Paulson said Goldcorp shareholders would get a “significant percentage” of the projected value from a separate agreement for Newmont and Barrick Gold Corp. to create a new Nevada joint venture.
Newmont chief executive Gary Goldberg said Monday the special dividend announced Monday recognizes the “potential synergy value” of the Nevada joint venture agreement.
“We have continued to engage with, and have listened carefully to, our shareholders, and we are pleased that several of our largest shareholders have expressed their support for the combination with Goldcorp.”
Newmont also said it has received Mexican anti-trust approval for the deal.
Vancouver-based Goldcorp announced Monday that it supports the special dividend which provides current Newmont shareholders with an immediate cash payment “for a portion of the synergy potential arising from the Nevada joint venture announced with Barrick Gold Corp.”
Goldcorp said its board of directors continues to unanimously recomment the merger with Newmonth.
The British Columbia Investment Management Corp. has said it will vote against the deal because of a US$12-million payment set to go to Goldcorp chairman Ian Telfer but advisory firm Institutional Shareholder Services Inc. has recommended Goldcorp shareholders vote in favour of the deal.
Goldcorp said the ISS report noted the strategic sense of the deal, and the significant synergies that are expected.
The proposed special dividend would be paid on May 1 to Newmont shareholders of record as of April 17, which is prior to closing of the proposed Newmont Goldcorp combination.
Newmont shareholders vote on April 11, while Goldcorp shareholders vote April 4.