The merger of Newmont and Goldcorp created the world's largest gold-mining company with expected annual production of
Question:
The merger of Newmont and Goldcorp created the world's largest gold-mining company with expected annual production of between 6 million and 7 million ounces of gold for decades to come. Newmont was itself targeted earlier in the year by competitor Barrick Gold but was able to rebuff the $18 billion unsolicited bid. Barrick Gold and Newmont formed this past summer a joint venture in Nevada that is the world's largest gold mining operation.
You are an independent business analyst and prior to the deal announcement you were approached by representatives of Newmontto analyze whether the acquisition of Goldcorp fits into their long-term strategy.
1) Critically evaluate the strategic fit of the Newmont and Goldcorp merger. What potential benefits (synergies, market power, etc.) does Newmont pursue with the acquisition of Goldcorp?
2) Critically appraise the deal structure and the price Newmont paid to Goldcorp's shareholders.
You are expected to apply relevant M&A concepts to the deal, not simply describe it.
Expert Answer:
1 Strategic Fit Operational Synergies Newmont and Goldcorp both have gold mining operations and by combining these theres potential for cost savings t... View the full answer
