Greatland Gold updates on Newmont acquisition of its Havieron partner

8th Sep 2023 10:22

(Sharecast News) - Greatland Gold updated the market on the planned acquisition of its joint venture partner Newcrest Mining by Newmont Corporation on Friday.

The AIM-traded firm said the previously-disclosed acquisition pertained to the Havieron project - a joint venture in which Greatland held a 30% interest, while Newcrest commanded a more substantial 70% share.

It added that the managerial duties of the Havieron project were under the direct oversight of Newcrest.

With the acquisition proceedings underway, Newmont Corporation's takeover of Newcrest was expected to be finalised by November.

Greatland said Newcrest had published a scheme of arrangement circular, and scheduled a shareholder meeting on 13 October to decide on the proposed takeover.

It explained that a standard component of such circulars was the inclusion of an independent evaluation.

In this instance, the Australian valuation advisory firm Grant Samuel & Associates was commissioned to determine if the transaction would serve the best interests of Newcrest shareholders.

It noted that Grant Samuel's assessment methodology combined Newcrest's 70% interest in Havieron and its 100% interest in Telfer, without separately appraising the Havieron project.

As a result, the collective valuation encapsulated the significant closure costs and associated liabilities of Telfer - factors to which Greatland was not subject.

Additionally, Grant Samuel used its own assumptions and adjustments to conclude on a combined value for Telfer and Havieron.

However, it said an important caveat existed, noting that Newcrest failed to update its Havieron mineral resource estimate in August.

As a result, Grant Samuel's assessment used data from Newcrest's August 2022 mineral resource estimate update, which itself only included drilling results up to November 2021.

That meant that any subsequent developments or discoveries in the last two years were not considered in the current valuation.

"As previously announced, the feasibility study for Havieron is ongoing, with value enhancing options being assessed to maximise value and de-risk the project," the Greatland board said in its statement.

"The feasibility study will therefore be an up-to-date, comprehensive and optimised assessment of Havieron.

"Assuming that Newmont's acquisition of Newcrest completes in November 2023 as expected, Greatland looks forward to the opportunity to work constructively with Newmont to optimise the development of Havieron, finalise the feasibility study and progress to a decision to mine."

At 1016 BST, shares in Greatland Gold were up 7.25% at 6.33p.

Reporting by Josh White for Sharecast.com.