Critical Metals Co. Makes Major Acquisition

Newmont Corp. (NEM:NYSE) announced in a press release that Newcrest Mining Ltd.'s (NCM:ASX) shareholders have voted to approve the acquisition of the company by Newmont Corp. The shareholders voted by a margin of 84.74% of those present for the vote, and 92.63% of all shareholders, the press release stated.

The company reports that, following the passage of this vote, the company will apply for approval in a hearing with the Federal Court of Australia on October 17, 2023, and that the company's acquisition plan will become effective after the second step in which it files a set of the court orders with the Australian Securities and Investments Commission.

If the scheme becomes effective, according to Newcrest, it will make a "special dividend of US$1.10 per Newcrest share," and these shares will be available on the Australian Securities Exchange and Papua New Guinea's National Stock Exchange as of October 18, 2023.

Newmont has stated that its qualifying shareholders in Australia will "receive Newmont Chess depositary interests," that the "PNG share register will receive Newmont Pets depositary interests," and that the "Canadian share register will receive Newmont shares."

Supply Gap for Critical Metals

Global Analyst Adrian Day, who recently attended gold mining conferences in Beaver Creek and Colorado Springs, reported that the mood was noticeably lighter than it has been of late: "In Beaver Creek, the conference was full, with investor attendance up from even the pre-COVID record."

Day commented that many of the junior companies were fundraising for future projects and that company tactics seemed to have diversified.

Rick Mills of Ahead of the Herd highlighted copper and silver as opportunities for investors, as they are both critical to the success of the green energy economy. Mills explained silver's success, saying, "Much of silver's value is derived from its industrial demand. It's estimated around 60% of silver is utilized in industrial applications, like solar and electronics, leaving only 40% for investing."

Additionally, copper is looking at a wide supply gap, as "by 2025, a massive shortfall will emerge for copper, which is now the world's most critical metal due to its essential role in the green economy," stated Mills.

Newmont Set to Reflect Rise in Gold

In November of 2022, Ron Struthers positively rated Newmont Corporation, stating that "it is now time to buy Newmont back." In his assessment of the company, Struthers cited Newmont's tendency to do well as gold prices increased as a factor in his recommendation, as well as the company's strong financials.

In November, it expects to pinpoint an implementation date for the company's acquisition of Newcrest, and in February of 2024, the company expects to provide guidance for the company post-acquisition, the company's investor presentation said.

Struthers predicted that "Newmont will gradually increase in value if gold stays around these prices, but a move in gold would quickly reflect in Newmont's stock price."

Adrian Day also rated Newmont Gold positively, remarking that "the purchase price is attractive." Day cited the company's 95% ownership of the Yanacocha mine in Peru, as well as the mine's production and life expectancy, as deciding factors in his assessment of the company.

In October of 2023, the company expects to receive regulatory approvals. In November, it expects to pinpoint an implementation date for the company's acquisition of Newcrest, and in February of 2024, the company expects to provide guidance for the company post-acquisition, the company's investor presentation said.

Ownership and Share Structure

Reuters has provided a breakdown of the company's ownership and share structure. According to Reuters, there no significant portion of the company is owned by management or insiders.

However, 23.03% of the company is held by institutional investors.

The Vanguard Group, Inc. owns 10.39% of the company with 82.58 million shares, BlackRock Institutional Trust Company, N.A., owns 2.82% of the company with 22.40 million shares, First Eagle Investment Management (UK) Ltd. owns 2.32% of the company with 18.45 million shares, Charles Schwab Investment Management, Inc. owns 2.08% of the company with 16.52 million shares, Geode Capital Management, LLC, owns 1.84% of the company with 14.61 million shares, Flossbach von Storch AG owns 1.80% of the company with 14.30 million shares, and DWS Investment GmbH owns 1.78% of the company with 14.16 million shares.

According to Reuters, there are 794.8 million shares outstanding, with 793.48 million free-float traded shares. Reuters reports that the company has a market cap of CA$30,822.19 and trades in the 52-week period between CA$34.81 and CA$55.41.

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1. Amanda Duvall wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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