Following the signing of a non-binding letter of intent in April, Newmont Mining Corporation has entered into a definitive, binding agreement with OceanaGold Corporation to sell Newmont Waihi Gold Limited. Melbourne-based OceanaGold will acquire all of Waihi’s open pit and underground mining assets and liabilities.
Terms of sale include cash proceeds of US$101 million, a US$5 million contingent payment and a 1% Net Smelter Royalty on a recent discovery north of Waihi’s current operations.
Approvals have been secured from each company’s board and closing of the deal is anticipated in the third quarter of 2015 following satisfaction of all conditions precedent and receipt of the necessary regulatory approvals.
“The sale of Waihi further strengthens Newmont’s balance sheet and improves our financial flexibility as we continue to sell select assets for cash at fair value,” said Newmont’s executive vice president for strategic development Randy Engel.
Waihi is about 150km southeast of Auckland in New Zealand. Gold was first discovered and mined in the area in 1878. The Martha open pit mine began operations in 1987 and was acquired by Newmont in 2002 during the merger with Normandy. Waihi produced approximately 132,000 ounces of gold in 2014.
Newmont is a leading gold and copper producer. The company employs approximately 28,000 employees and contractors, with the majority working at managed operations in the United States, Australia, New Zealand, Ghana, Peru, Suriname and Indonesia.