Newcrest Mining said that its board of directors has voted unanimously to reject the $16.9bn takeover bid by rival gold mining major Newmont on the grounds that it doesn’t provide enough value to its shareholders.

It can be recalled that in early February, Newmont came up with a proposal to acquire 100% of Newcrest Mining by exchanging 0.380 of its shares for each of the latter’s shares.

Based on this exchange ratio, the merged company will be owned 30 percent by Newcrest Mining’s shareholders, while Newmont’s shareholders will hold the remaining 70% stake.

The offer from the American gold miner values each share of Newmont at AUD 27.16 ($18.8).

Newcrest Mining has operations in Australia, Papua New Guinea, as well as Canada. On the other hand, Newmont has mining operations in North America, Australia, South America, and Africa.

Although it rejected the offer, the Newcrest Mining board stated that it is willing to provide access to restricted, private information on a non-exclusive basis to the American mining company. This will help determine whether Newmont is able to develop a better offer, said Newcrest Mining.

The Australian gold miner has stated that the disclosure of data is subject to certain requirements, including the signing of an appropriate non-disclosure agreement.

Newcrest Mining stated that there is no guarantee that future talks with Newmont result in an updated proposal or any agreement.

The Australian gold miner, in a statement to the Australian Securities Exchange (ASX), said: “The Board considers Newcrest to be uniquely positioned with a portfolio of long-life Tier 1 gold and copper assets, with increasing copper exposure and a high-quality development pipeline.

“The Board remains fully committed to acting in the best interests of Newcrest shareholders.”

In the past, Newmont made an indicative conditional, non-binding takeover proposal to Newcrest Mining, with 0.363 of its shares to be exchanged for each of the shares of the latter. The offer then was rejected by the Australian gold mining company’s board, citing that it would not provide enough value for Newcrest Mining’s shareholders.

Recently, Newcrest Mining said that it will go ahead with the Lihir mine expansion project in Papua New Guinea, following the approval of the feasibility study by its board.

  Australia, gold, Gold mining, Newcrest Mining, Newmont