GGPChat

Greatland Gold, capitalised at £350.7 million ($687 million) on the London Stock Exchange, has pulled the trigger on a much-anticipated $500 million equity raise to acquire WA gold mine Telfer off Newmont, Street Talk can reveal....

https://www.afr.com/street-talk/greatla ... 909-p5k93p

Greatland Gold plc (AIM:GGP) (Greatland or the Company) refers to an article published in the Australian Financial Review today titled "Greatland Gold raising [A]$500m to buy Newmont's Telfer" (Media Article).

The Media Article reports that Greatland is seeking to raise equity, with material support from Wyloo Consolidated Investments Pty Ltd (Wyloo), to fund the acquisition of Newmont Corporation's (Newmont) joint venture interest in the Havieron gold-copper project (Havieron) and its 100% owned Telfer gold-copper mine (Telfer), (the Potential Acquisition).

The Media Article follows Newmont's announcement on 22 February 2024 of its intention to divest a number of non-core assets, including Telfer and its Havieron joint venture interest. This also follows Greatland's comments on 30 April 2024 and 31 July 2024 regarding its last right of refusal to acquire the remaining 70% interest in Havieron, and that accordingly Greatland considers itself strongly positioned should an opportunity arise to consolidate ownership of Havieron on accretive terms for Greatland shareholders.

Status of Potential Acquisition

Greatland confirms that it is in advanced negotiations with Newmont in respect of the Potential Acquisition, which remain incomplete, and that existing cornerstone shareholder Wyloo is intending to provide material support for the Potential Acquisition. Greatland and Newmont have entered into a binding exclusivity agreement which provides for a period of exclusivity to finalise and enter into binding transaction documentation in respect of the Potential Acquisition.

The proposed terms of the Potential Acquisition remain confidential, however Greatland notes that the proposed consideration includes a mix of upfront cash, deferred payments and equity. Settlement of the Potential Acquisition is proposed to be conditional on completion by Newmont of ongoing remediation works in respect of the Telfer tailings storage facility.

If the Potential Acquisition is ultimately agreed, settlement would be subject to (among other conditions) Greatland shareholder approval as a reverse takeover for the purposes of the AIM Rules, on the basis that the Potential Acquisition is expected to exceed one or more of the financial metric class tests set out in Schedule Three of the AIM Rules. Greatland would also be required to publish an admission document for re-admission to AIM.

The Potential Acquisition remains subject to, among other matters, the agreement of binding documentation and corporate approvals. There is no certainty that the Potential Acquisition or any other transaction will proceed at all (or the terms of any such transaction if it does proceed).

Temporary suspension of trading

In light of this leak, dealings in the Company's ordinary shares will be temporarily suspended from trading on AIM under AIM Rule 40, with immediate effect until such time as the admission document in relation to the possible acquisition and fundraising have been published in compliance with AIM Rule 14.

Notwithstanding the temporary suspension of trading in the Ordinary Shares, the Company will continue to make announcements as and when there are any developments that require announcement under the AIM Rules.

Further developments

Greatland will announce any further developments, including the entry into any binding agreement for the Potential Acquisition, as required by its disclosure obligations.

Andrew Forrest-backed Greatland Gold has confirmed it is close to buying Newmont’s Telfer gold and copper mine in Western Australia, but says it wants leaky tailings dams at the site fixed first.

Street Talk revealed on Monday afternoon that Greatland was set to issue close to $500 million of new shares to help fund the deal, with major shareholder Andrew Forrest set to subscribe for his share of stock....

Greatland has been the hot favourite to buy Telfer since Newmont formally put the asset up for sale in February because Greatland already owns 30 per cent of the gold and copper discovery that underpin’s Telfer’s future; Havieron.

Telfer was a marginal asset bound for closure in 2018 when Greatland discovered Havieron about 45 kilometres away.

Telfer’s owner at the time, Newcrest Mining, rushed to buy 70 per cent of Havieron in a bid to ensure its prospective geology could be processed at Telfer’s established infrastructure.

Newmont became Greatland’s partner at Havieron when it acquired Newcrest last year. Newmont is selling Telfer - and several other mines - because it does not consider them to be elite by global standards.

Greatland’s 30 per cent stake in Havieron means it has the right to match offers for Newmont’s stake in Havieron. While Greatland does not have matching rights for Telfer, most buyers would not be interested in Telfer if it did not come with Havieron, meaning Greatland has held all the aces in the negotiations.

But 47-year-old Telfer is showing signs of wear and tear; two tailings dams at the mine have been leaking in recent years, forcing Newmont to curtail production for repairs earlier this year.

Greatland told investors that it wanted the dams fixed before it acquired Telfer.

“Settlement of the potential acquisition is proposed to be conditional on completion by Newmont of ongoing remediation works in respect of the Telfer tailings storage facility,” said the company.

Dr Forrest’s private company Wyloo Metals owns 8.5 per cent of Greatland, while three of Greatland’s seven-person board of directors have historic links to Dr Forrest’s flagship company Fortescue.

“Existing cornerstone shareholder Wyloo is intending to provide material support for the potential acquisition,” said Greatland on Monday evening.

The long-awaited combination of Telfer and Greatland could be just the first step in a broader consolidation of WA’s Paterson Province; Rio Tinto is looking for a partner to develop the Winu copper and gold discovery about 100 kilometres north of Havieron.

https://www.afr.com/companies/mining/gr ... 909-p5k97b