March 27, 2023

M&A Report: Metals Funds that Benefit from Newmont’s ~US$16.9B Bid to Acquire Newcrest Mining

Newmont and Newcrest Merger

This report provides a summary of Gold & Precious Metal Funds that hold:

  1. The Acquired Company only: Newcrest Mining Ltd (ASX: NCM)
  2. The Acquirer only: Newmont Corp. (NYSE: NEM)
  3. Both the Acquirer and the Acquired Company

The world’s largest gold producer, Newmont Corp. (NYSE: NEM), has reported a ~ US$16.9 Billion offer for Australia’s leading gold producer, Newcrest Mining Ltd. (ASX: NCM), in an effort to build a global gold supermajor.

The indicative offer implies a 21% premium to Newcrest’s share price before the bid was announced, materially below the traditional 30% takeover premium. Newcrest shareholders would receive 0.38 Newmont shares for every Newcrest share, giving them a 30% stake in the enlarged miner. It is a 4.7% improvement from a previous offer that was rejected for not providing enough value, Newcrest disclosed.

Newcrest’s operations include its top-class Cadia asset in Australia, an expanding footprint in North America and Papua New Guinea, and growth potential in copper, highly prized as key to the energy transition.

Newcrest Mining Ltd. onlyNewmont Corp. onlyNewmont Corp & Newcrest Mining Ltd 
Midas Fund Inc.AuAg Silver BulletAAZ Prestige Or
BlackRock Global Funds World Gold FundAllspring Precious Metals Fund
CI Gold Corporate ClassAmerican Century Global Gold Fund
Claresco Or et Métaux PrécieuxAmundi Gold Stock
C-Quadrat Gold & Resources FundBAKERSTEEL Electrum Fund
DMS Charteris Gold and Precious Metals FundBAKERSTEEL Precious Metals Fund
IG Mackenzie Global Precious Metals ClassBlackRock Gold & General Fund
Incrementum Crypto Gold FundCours CM-AM Global Gold
Konwave Sustainable Gold Equity FundCPR Invest – Global Gold Mines
Lombard Odier Funds – World Gold ExpertiseDeutsche Invest I Gold & Precious Mtl. Equities
Mackenzie Precious Metals ClassDJE Gold & Ressourcen
NinetyOne Funds Series iii – Global Gold FundDWS Noor Precious Metal (Sharia Compliant)
OCM Gold FundEdmond de Rothschild Goldsphere
Plutos Gold PlusES Baker Steel Gold and Precious Metals Fund
Precious Metals UltraSector ProFundEuroPac Gold Fund
Premium Gold and Metal Open FundFidelity Select Gold
RBC Global Precious Metals FundFirst Eagle Gold Fund
R-Co. Thematic GoldFranklin Gold & Precious Metals Fund
Rydex Precious Metals FundFranklin Gold and Precious Metals Fund (Lux)
Silver Plus FundGabelli Gold Fund Inc.
Sprott-Alpina Gold Equity FundGAMCO Glbl. Gold, Nat. Res. & Income Trust
Sprott-Alpina Gold Equity UCITS FundGAMCO Nat. Res., Gold & Income Trust
TD Precious Metals FundInvesco Gold & Special Minerals Fund
Tocqueville GoldInvesco Gold and Special Metals Fund (Lux)
U.S. Glbl. Inv. Gold and Precious Metals FundiW Precious Metal Mining Equities
U.S. Glbl. Inv. World Precious Minerals FundLandolt Investment (Lux) SICAV – Gold
VanEck International Investors Gold FundNinetyOne Global Gold Fund (Lux)
VanEck VIP Global Gold FundPlaceuro Gold Mines
Precious Metals Champions Fund
Quilter Investors Precious Metals Equity Fund
Schroder ISF Global Gold Fund
Sprott Gold Equity Fund
Stratégie Indice Or
SVS Sanlam Global Gold & Resources Fund
United Gold & General Fund
USAA Precious Metals and Minerals Fund
Value Intelligence Gold Company Fonds (AMI)
Zenito Silver and Gold Fund
1 Fund28 Funds38 Funds

Portfolio Holdings Summary

At the time of the most recently recorded asset allocation New York City based Midas Fund Inc., managed by Thomas B. Winmill LLB BA, was the only gold fund to have retained a holding in only the acquired company: Newcrest Mining Ltd. (ASX: NCM). This holding represented ~5.5% of the total portfolio of Midas Fund Inc. This fund would have received the highest material performance benefit from the acquisition news announcement. 28 gold funds held only Newmont Corp. (NYSE: NEM), and 38 funds held both Newmont Corp. (NYSE: NEM) and Newcrest Mining Ltd. (ASX: NCM).

“In advancing gold cycles, mergers and acquisitions amongst gold producers can accelerate. As gold company mergers reduce the total number of portfolio company holdings for gold funds, managers often invest more capital in mid-tier and smaller companies. This results in dynamic price activity for smaller gold producers and exploration companies as the gold cycle advances. At the beginning of 2023, we are in the early stages of this type of gold market cycle.” – Christopher J. Berlet BSc, CFA provides prices, performance, and trade information for all the world’s metal ETFs including Precious Metals, Battery Metals, Platinum Group Metals, and Base Metals and comprehensive fund information, including asset allocations, for Gold & Precious Metals Managed Funds from all investment jurisdictions.

Report prepared by:  Kay Samnani, Analyst supported by Christopher J. Berlet BSc, CFA

Disclaimer: The author of this post may or may not be a shareholder of any of the companies mentioned in this column. None of the companies discussed in the above feature have paid for this content. The writer of this article/post/column/opinion is not an investment advisor, and is neither licensed to nor is making any buy or sell recommendations. For more information about this or any other company, please review their public documents to conduct your own due diligence. To access the disclaimer and other important legal notices, click here.

3 responses

  1. Tracy Weslosky Avatar
    Tracy Weslosky

    I love this Chris, thank you. And a special warm welcome to you and Kay and the team at MineralPrices for sharing this update complimentary to our readership. Excellent, thank you.

  2. Stephen Lautens Avatar
    Stephen Lautens

    Excellent read. Looking forward to more from Chris.

  3. John Cook Tormin Resources Limited Avatar
    John Cook Tormin Resources Limited

    Many thanks Chris,

    A fuller and more comprehensive report than I read on line earlier this morning. In my opinion, not a sensible acquisition

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