Newmont Mining Corp. and Fronteer Gold Inc. today announced that they have entered into an agreement in which Newmont will acquire all of the outstanding common shares of Fronteer Gold.
Under the Plan of Arrangement, shareholders of Fronteer Gold will receive $14 (Canadian) in cash and one common share in a new company, Pilot Gold, which will own certain exploration assets of Fronteer Gold, for each common share of Fronteer Gold. The cash consideration represents a premium of approximately 37 percent to the closing price of the common shares of Fronteer Gold on the TSX as of Wednesday and equates to a value of approximately $2.3 billion (Canadian) for Fronteer Gold, excluding Pilot Gold.
Fronteer Gold owns a 100 percent interest in the development-stage Long Canyon project, about 100 miles from Newmont’s existing infrastructure in Nevada. The proximity of Long Canyon to Newmont’s Nevada operations provides the potential for significant development and operating synergies.
Fronteer Gold also owns a 100 percent interest in the Northumberland project and a joint venture interest with Newmont in the Sandman project in Nevada, among other assets.
“The acquisition of Fronteer Gold will contribute significantly to our anticipated growth profile in North America,” said Richard O’Brien, Newmont’s President and CEO.
