Newmont (NEM) Gets All Regulatory Approvals for Newcrest Buyout
Newmont Corporation NEM received all the necessary government regulatory approvals for its proposed acquisition of Newcrest Mining Limited, marking a significant milestone in the transaction process. The Securities Commission of Papua New Guinea (SCPNG) granted the required exemptions and confirmations under PNG capital markets law. The Philippine Competition Commission (PCC) also expressed its approval of the deal last week.
Newmont is committed to fostering sustainable value-sharing and driving substantial economic growth through its involvement in the prestigious Lihir gold mine and the promising Wafi-Golpu gold and copper project. As the global leader in the gold industry, Newmont recognizes the untapped economic opportunities within Papua New Guinea and is dedicated to engaging its citizens in the advantages stemming from its operations, projects and community contributions.
In preparation for this acquisition, Newmont has taken strategic steps, including appointing Alwyn Pretorius as managing director for its dedicated Business Unit in PNG, with Pretorius based in Port Moresby. Newmont plans to establish a secondary listing of Newmont stock depositary interests on the PNGX upon the completion of the transaction.
Newmont Corporation Price and Consensus
Newmont Corporation price-consensus-chart | Newmont Corporation Quote
On May 14, 2023, Newmont announced its definitive agreement to acquire Newcrest, a move that would create a world-class portfolio of assets primarily located in favorable, low-risk mining jurisdictions. The combined entity would boast a multi-decade production profile stemming from 10 large, long-life and low-cost Tier 1 operations, with increased annual copper production primarily in Australia and Canada. The merger is anticipated to yield annual pre-tax synergies of $500 million, expected to be realized within the first 24 months along with a target of at least $2 billion in cash improvements through portfolio optimization in the initial two years following the deal's closing.
Newmont and Newcrest anticipate the transaction's completion in the current year's fourth quarter, subject to meeting customary closing conditions.
Newmont’s shares have fallen 21.1% in the past year compared with the industry's 8.9% rise in the same period.
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Zacks Rank & Key Picks
Newmont currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are WestRock Company WRK and Hawkins, Inc. HWKN, both sporting a Zacks Rank #1 (Strong Buy), and The Andersons Inc. ANDE, carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The earnings estimate for Westrock’s current year is pegged at $3.02. In the past 60 days, WRK’s current-year earnings estimate has been revised upward by 29%. WRK beat the Zacks Consensus Estimate in three of the last four quarters, with the average earnings surprise being 30.7%. The company’s shares have rallied 13.6% in the past year.
The consensus estimate for Hawkins’ current-year earnings is pegged at $3.40, indicating year-over-year growth of 18.9%. In the past 60 days, HWKN’s current-year earnings estimate has been revised upward by 32.3%. HWKN beat the Zacks Consensus Estimate in all the last four quarters, with the average earnings surprise being 25.6%. The company’s shares have rallied 52.7% in the past year.
The Zacks Consensus Estimate for ANDE's current-year earnings has been revised 3.3% upward over the past 60 days. Andersons beat the Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 64.4% on average. ANDE shares have rallied around 57% in a year.
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