26 Mar Newmont inches closer to $10 billion Goldcorp takeover with special dividend offer
Newmont Mining Corp has won the support of at least two key investors for its US$10 billion takeover of Goldcorp after offering an 88-cents-per-share dividend to shareholders.
The gold mining giant said in a regulatory statement that the immediate cash payment would represent a portion of the savings from a separate agreement with Barrick Gold Corp.
Newmont investors welcomed news of the dividend payment, after previously opposing the deal on grounds that Goldcorp shareholders benefited too much from it.
“Although the dividend is small, it is a step in the right direction,” said Paulson & Co in an emailed statement. “Since the Newmont board and other significant shareholders are supportive of the revised terms, we will no longer oppose the transaction.”
Meanwhile, the stance of Newmont’s third largest shareholder, Van Eck International Investors stance, also softened in the wake of the special dividend announcement.
“We’re very pleased with Newmont’s decision,” said Joe Foster, portfolio manager at Van Eck. “Companies always claim they’re going to create synergies. It’s great to see Newmont putting their money where their mouth is and giving us a payout up front.”
Newmont’s friendly bid to buy Goldcorp is set to create the world’s largest gold producer.