Gold miner Newmont Mining Corporation (NEM) has signed a Letter of Intent to divest its Midas operation in Nevada to Waterton Global Resource Management, Inc.
The proposed deal is subject to necessary regulatory and third party approvals along with execution and delivery of an acquisition agreement and completion of confirmatory due diligence.
Both companies has unanimously agreed to terminate the Letter of Intent on Oct 14, 2013, if it is not extended by a mutual agreement of the parties, or earlier superseded by the acquisition agreement. Also, no assurance was provided about the completion of this transaction.
Newmont is considering selling its underground Midas mine so that it can focus more on its core businesses by disposing its non-core assets. In this process, Newmont is working consistently in line with its strategy to deliver value to the shareholders.
Newmont’s Midas underground mine operates through roughly 200 employees and is located in north central Nevada, between Elko and Reno. The company acquired the mine through its merger with Normandy in 2002.
The Midas operation consists of an underground mine, waste rock area, crushing plant, conventional mill, refinery, cyanide destruction circuit, tailings impoundment, and two settling ponds. The mine also provides ancillary facilities like a maintenance shop, warehouse complex, administration and security building, and facilities for distributing diesel fuel, gasoline, and propane.
Waterton is a premier mining-focused private equity investment firm. Its significant sector knowledge and proactive approach to asset management have led it to enter into long-term partnerships with companies who have proven world-class potential and enduring growth prospects.
Waterton holds a strong track record of structuring and managing investments in the precious metals sector. Formerly, Waterton’s internal project evaluations group assisted Barrick Gold Corp. (ABX) in evaluating and inspecting its all asset acquisitions.
Newmont currently holds a Zacks Rank #3 (Hold).