Filed by Newmont Mining Corporation
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934
Subject Company: Normandy Mining Limited
Commission File No. 132-00965
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995
The following contains forward-looking information and statements about Newmont
Mining Corporation, Franco-Nevada Mining Corporation Limited, Normandy Mining
Limited and the combined company after completion of the transactions that are
intended to be covered by the safe harbor for "forward-looking statements"
provided by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are statements that are not historical facts. These
statements include financial projections and estimates and their underlying
assumptions; statements regarding plans, objectives and expectations with
respect to future operations, products and services; and statements regarding
future performance. Forward-looking statements are generally identified by the
words "expect," "anticipates," "believes," "intends," "estimates" and similar
expressions. The forward-looking information and statements in this presentation
are subject to various risks and uncertainties, many of which are difficult to
predict and generally beyond the control of Newmont, Franco-Nevada and Normandy
Mining, that could cause actual results to differ materially from those
expressed in, or implied or projected by, the forward-looking information and
statements. These risks and uncertainties include those discussed or identified
in the public filings with the U.S. Securities and Exchange Commission made by
Newmont and Normandy, and Franco-Nevada's filings with the Ontario Securities
Commission; risks and uncertainties with respect to the parties' expectations
regarding the timing, completion and accounting and tax treatment of the
transactions, the value of the transaction consideration, production and
development opportunities, conducting worldwide operations, earnings accretion,
cost savings, revenue enhancements, synergies and other benefits anticipated
from the transactions; and the effect of gold price and foreign exchange rate
fluctuations, and general economic conditions such as changes in interest rates
and the performance of the financial markets, changes in domestic and foreign
laws, regulations and taxes, changes in competition and pricing environments,
the occurrence of significant natural disasters, civil unrest and general market
and industry conditions.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with their proposed transactions, Newmont Mining Corporation
will file a proxy statement and a registration statement with a prospectus
with the U.S. Securities and Exchange Commission. INVESTORS AND SECURITY
HOLDERS ARE ADVISED TO READ THE PROXY STATEMENT AND THE PROSPECTUS WHEN THEY
BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors
and security holders may obtain free copies of the proxy statement and the
prospectus (when available) and other documents filed by Newmont with the
Commission at the Commission's web site at http://www.sec.gov. Free copies
of the proxy statement and the prospectus, once available, and other filings
made by Newmont or Normandy with the Commission, may also be obtained from
Newmont. Free copies of Newmont's and Normandy's filings may be obtained by
directing a request to Newmont Mining Corporation, Attn: Investor Relations,
1700 Lincoln Street, Denver, Colorado 80203, Telephone: (303) 863-7414.
Copies of Franco-Nevada's foreign filings may be obtained at
http://www.sedar.com.
PARTICIPANTS IN SOLICITATION
Newmont Mining Corporation and its directors, executive officers and other
members of its management and employees may be soliciting proxies from its
stockholders in connection with the transactions. Information concerning
Newmont's participants in the solicitation is set forth in Newmont's Current
Report on Form 8-K filed with the Commission on November 14, 2001, as amended.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 1
NEWMONT MINING CORP.
DECEMBER 10, 2001
7:30 A.M. CST
Coordinator Good morning and welcome to the Newmont Mining
Corporation Conference Call. All participants will be
able to listen only until the question and answer
session of the call. At the request of Newmont
Mining, this call is being recorded. If you have any
objections, you may disconnect at this time.
I would now like to introduce your host for today,
Miss Wendy Yang. You may begin.
W. Yang Thank you, Operator. Good morning to North America.
Thank you for joining us on our conference call today
to review our superior offer to acquire the shares of
Normandy and our vision of a new Newmont. This call
is being Simulcast on our Web site and will be
available for playback for a limited time.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 2
Today we will be discussing some forward-looking
information, so you should be aware that there are
risk factors unique to our industry, and these risks
are described in detail in our filings with the SEC.
The information that we are discussing today,
December 10, 2001 in the United States and December
11th in Australia, are relevant for the current
period. For the most up-to-date material disclosures,
please refer to our main SEC filings and news....
Speaking today from Sydney are Wayne Murdy, President
and CEO of Newmont and Pierre Lassonde, President and
Co-CEO of Franco-Nevada. Wayne, please go ahead.
W. Murdy Good day, ladies and gentlemen. Thanks for joining us
today to hear more about our announcement of a
revised offer that we believe to be a decisive step
in realizing our collective vision of creating the
world's greatest gold company, and the unique equity
that we expect to be the new gold standard for the
21st century.
The revision means that now both the cash and the
stock portions of the Newmont offer are indisputably
and significantly superior to the
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 3
competing elements of offer to acquire Normandy. We
have taken this step without sacrificing the other
significant economic and strategic advantages that
the Newmont offer has enjoyed from the day it was
launched. Both the immediate economic benefits and
the long-term strategic benefits for Newmont and the
industry that we told you about less than a month
ago, not only remain intact and compelling under the
revised offer, they fully justify the revision.
I'm in Australia today with Pierre Lassonde, who is
the Co-CEO of Franco-Nevada, whose board, last month,
unanimously recommended Newmont's offer of
eight-tenths of a share of Newmont for each
Franco-Nevada share. In addition, today, Normandy's
Board of Directors, unanimously recommended Newmont's
revised offer to Normandy shareholders and again
advised against the Anglo Gold offer.
We're here to discuss and answer your questions about
the news that Newmont, Normandy and Franco-Nevada
announced, worldwide, about
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 4
15 hours ago, our rationale and what it means for the
shareholders of Normandy, Newmont and Franco.
I'll start by quickly reviewing the revised offer. As
we announced, the revised Newmont offer values
Normandy at Australian dollar-ninety per share. This
is fully 15% more than the current value of Anglo
Gold's revised offer announced on November 25th.
Under the revised Newmont offer, Normandy
shareholders will receive a cash payment of forty
cents Australian, double the twenty cents Australian
offered by the Anglo Gold proposal. The cash payment
is in addition to the exchange ratio, which we did
not change, of .0385 shares of Newmont common stock
for each Normandy share. As underscored in our press
release, by accepting the Newmont offer, the Normandy
shareholders receive shares in a North American
company traded on the New York Stock Exchange and
included in the S&P 500, which offers true liquidity.
As to timing, let me be clear that all of us here
today are committed to completing the acquisition of
both Normandy and Franco-Nevada by mid-February 2002.
In all, we are offering the Normandy shareholders no
less
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 5
than the ability, through a simple off-market bid, to
participate in the premiere gold company, the
industry leader in terms of gold production, total
reserves, EBIT DA generation, trading liquidity and
leverage to gold.
What's more, this combined company will benefit from
a strong balance sheet that provides the financial
flexibility to capitalize on a truly outstanding
pipeline of development projects. Investors around
the world have told us that they share our view that
this combination immediately makes Newmont one of the
strongest, best capitalized companies in the
industry.
Newmont's net debt to total capitalization ratio will
fall to 23% and with strong free cash flows and the
ability to add incremental cash from rationalization
of assets, significant opportunities allow us to
decrease our net debt to total capitalization, below
20% within a year. You should know that this compares
with an indicated 33% net debt to total
capitalization ratio for the company envisioned by
Anglo Gold. The company Anglo seeks to create, also,
would have significantly less flexibility to
redistribute cash flow worldwide, due to the South
African Reserve Bank currency restrictions.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 6
Finally, over the past two years, Anglo Gold has had
a cash flow deficit of approximately $153 million,
before financing activities, while paying out over
$580 million in dividends, quite apart from the
long-term viability of such a policy. Bear in mind,
that for non-South African holders, Anglo Gold's
dividends can be expected to decline in real terms,
should the recent decline in the rand continue.
As we promised you on November 29th, when Anglo Gold
revised its offer, Newmont was very carefully
considering this decision. Our commitment was to
craft a winning bid, but not a winning bid at any
cost. The revised offer gives Newmont clear decisive
superiority over the Anglo Gold bid, and we have also
achieved this without compromising the long-term
advantages for value creation, integral to building
the new Newmont.
So it is with pride that our management and our Board
of Directors, working with our advisors, can tell you
that the acquisition of Normandy, on the basis of
this revised offer, will continue to be accretive to
Newmont in terms of earnings, free cash flow and net
asset value. The
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 7
approximately $370 million cost of the cash component
will be financed with an existing, but untapped, $600
million revolving credit facility.
However, as you'll recall from our announcement of
the Franco portion of our acquisition plan last
month, upon completion of this transaction, Newmont
will have more than $850 million in cash and liquid
securities. In short, everything we have seen
reinforced by the successful completion of the recent
capital raising for Australian Magnesium Corporation,
Ltd. makes us feel very comfortable about this
increase.
We continue to believe in the opportunities to
achieve the $70 million to $80 million in annual
synergies from the acquisition of Normandy and
Franco-Nevada. We see significant asset realization
opportunities and opportunities for operational
improvements. We will also capitalize on Normandy's
growth prospects, building on the financial strength
of Newmont to add significant value for all current
and future Newmont shareholders.
Let me now ask Pierre to comment on the transaction
and the opportunities afforded to us.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 8
P. Lassonde Thanks, Wayne, and good morning, ladies and
gentlemen. It's a pleasure to be here in Australia,
even though it's a little bit early in the morning.
We have had a great day here in Australia. In fact,
we've had a great three weeks, Wayne and I, on the
road. We've visited our shareholders all over North
America and Europe. The response has been truly
heartwarming and overwhelming, in view of the vision
of the company that we're creating.
I think that everybody that we've talked to clearly
sees that we are creating something very special.
That not only this company will a market leader, but
also it will be clearly different than our three
nearest competitors. Not only because we're not going
to be a hedge company; I mean that is clearly one of
our philosophical differences. But I think the makeup
of the company is what makes it something very
special.
The combination of the three companies with the
Franco-Nevada royalty will create, basically, the
cushion against low gold prices. The balance sheet
will help, also, tremendously, in that regard. The
Newmont assets in Nevada, in Peru and in Indonesia
will form the core properties, including
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 9
then those of Normandy, in Australia, to create a
company that would be a market leader. Then from the
60 million acres of land, the largest industry land
package, we will be able to develop attractive new
projects, but also, we're going to be able to
increase that royalty cash flow, increase that
cushion.
One of the things that - the offer will, of course,
use some of our cash. I want to point out that when
we close this transaction, the combined company will
have over $750 billion in cash and a $100 million in
liquid investment, for a total of $850 million. So
yes, this revised offer is going to use some of that.
But I can assure you that our objective will be to
very rapidly rationalize some of the assets that are
in the companies, particularly in Normandy, as we had
promised, to bring the debt ratio to the level that
we had originally envisaged, which is 18%, as soon as
possible. I can think that we can achieve that in a
fairly rapid manner, as there are assets that are
easily identifiable that the market could easily use,
in the sense that we could create some synergies with
either other companies in different forms.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 10
So we feel that the transaction is a winning
transaction, that this bid is going to be a winning
bid, that the market will see it this way, and that
we're going to go on and complete the transaction and
get on with creating and developing the very best
gold company in the world.
I'll stop with that. I could continue and go on,
because we've been on a roll. I think if you look at
the Web site, there's some very interesting --.
Australia is a very peculiar place; they love to
personalize companies. But the fact is that we have
had a great response here, and you can look at it and
we think that we are on a roll. We'll be here, Wayne
and I, for the next ten days, until we get this over
with. Then we'll get on to building a great company.
So with that --. I might add that Robert was supposed
to be here, I think he kind of missed his taxi to
come over. Hopefully during the question period he'll
come over and he'll be able to address the conference
call as well.
I just want to remind you that this company will have
the highest leverage to gold. It's one of the key
attractions going forward, and we still believe
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 11
that we're going to see a rise in the gold price in
the next three years. We're very bullish. We've told
you why we're very bullish; that hasn't changed. With
that I will cut it off right here and leave you some
time for questions. Wayne.
W. Murdy At this point then, we would like to open it up to
questions.
Coordinator Thank you. At this time we are ready to begin the
formal question and answer session. Our first
question comes from Victor Flores. Sir, you are
connected.
V. Flores Thank you, very much. Good morning - a few questions
of the miscellaneous variety. First of all, Anglo
pointed out, when they revised their offer, that they
had learned some things through the public domain.
You've had access to full due diligence, but in the
process of completing your transaction, have you
found anything on the due diligence side that has led
you to find additional value in Normandy?
W. Murdy I think, Victor, as we've gone through it again, we
did have due diligence, and so we felt good about the
package going in and had a range of values
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 12
that we felt we could live with. There have been no
significant individual items and we didn't feel the
necessity to detail that out. Again, when we came in
this, I think we indicated to the market that this
was very accretive to us under the income free cash
flow and net asset value test.
I guess the only thing I would comment on was the
completion of the Australian Magnesium Corporation
financing. That, in our mind, did relieve what could
potentially have been a contingent liability. So that
probably was one item that you could point to. But
again, we're well within what we view as our value
range.
V. Flores Great. Now secondly, you've changed some of the
conditions of your takeover proposal. The most
important is the fact that you no longer require 90%
of the Normandy shareholders to tender. What is the
new condition? Are you looking for 50.1% at this
point in time?
W. Murdy Yes, we were always at 50.1, but we had the cash
component in the original offer was subject to the
90% test and we have dropped that.
V. Flores Okay, so you're still at 50.1 for the full cash, plus
stock.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 13
W. Murdy Yes.
V. Flores Then finally, if I could - I know this is perhaps a
bit thorny, Wayne and Pierre. Could you comment on
what you expect from the takeover's panel, with
respect to Anglo Gold's challenge? You know their
allegation that certain shareholders in Normandy are
getting better treatment.
W. Murdy They have complained to the takeover's panel on many
items so far, and they're 0 for 4.
V. Flores Any sense for when they rule on this one, which is
perhaps the--?
W. Murdy The reality is that we're advised here that we're not
supposed to be commenting on things that are before
the panel. So I've been warned, many times, not to do
it. Now I will note that somehow we're playing by
different rules than our compadres, who have put out
a lot of press releases. But we are extremely
comfortable with all the legal contracts and
arrangements that we've entered into. We've said that
up front, and we have seen nothing to change our view
of that.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 14
V. Flores Great. Thank you, very much. I appreciate it.
Coordinator Our next question comes from John Duty from Gold
Stock Analysts.
J. Duty Good morning, gentlemen. I definitely like the
raised price side of the deal. I wonder if you can
comment on why you haven't dropped the contingency
for the Franco and Newmont to go ahead and merge. It
would certainly create a clearer path, right now, to
Franco's cash, I would think, and make a lot of
people more comfortable with the total deal.
W. Murdy Well, as we've said from day one, this is transaction
that only makes sense on a three-way basis; that's
the power and the vision here. The transaction is
structured such that at the point we hit the 50.1%
interest in Normandy, it triggers the full merger
with Franco. So we're playing to win. It's a
three-way deal. Again, despite some of the things you
may read, we don't think it's highly conditional, at
all.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 15
J. Duty But if Franco did get a higher offer from somebody
that they felt they had to accept under some
conditions for their total stockholders, that would
sort of leave Newmont holding the bag, wouldn't it?
P. Lassonde The Normandy shares that we own have been pledged to
Newmont. So I'm not too sure what you're referring
to.
J. Duty Well, I'm just wondering if your fellow brothers in
Toronto wanted to upset the apple cart or something.
P. Lassonde Well, all I can say is good luck to them.
J. Duty Okay, thanks. Good luck to your both.
P. Lassonde Yes, thank you.
Coordinator Our next question comes from John Tamaso.
J. Tamaso Good morning. Given the poor performance of the South
African rand in the last several months, which is
probably a reasonable barometer of that
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 16
country's outlook and, of course, Anglo Gold's
position of having a big ... assets in South Africa.
I expected Newmont's bid to prevail even if it was 3%
to 5% lower than Anglo Gold's. In fact Franco-Nevada
and Bob Ducrepnie's commitment of their shares to
Newmont seemed implicitly to acknowledge that.
Wayne, I'm very surprised that you're bidding a 15%
premium to Anglo Gold, in view of the American
currency and flag looking a little better to most
foreign investors in South Africa. Could you explain
how the premium was determined?
W. Murdy Yes, John. I think you point out a number of
strengths that we have in this transaction and I
agree with everything you say. The only card that
Anglo had in this is that they do have time on their
side. They were out first and their offer ends on the
27th of this month. We expect to close the middle of
February, about 25% of the shares. We hear 25% to 30%
of the shares are in the hands of the arbs. As we all
know, they don't care about the company long-term;
it's strictly the transaction. So we had to recognize
that timing difference and we felt that this clearly
accomplishes that.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 17
Again, I would point out that there is no change in
the arrangement between Franco and ourselves. So the
bump is going to just 80% of the shareholders.
J. Tamaso Wayne, as we recall the Santa Fe battle with Home
Stake, four or five years ago, there came a point
where the more Home Stake sweetened their bid, the
more their stock fell and Newmont prevailed. In that
sense, Anglo Gold doesn't appear to be that much of a
threat. Why did you go to $1.90 rather than $1.66 or
$1.64?
W. Murdy Again, I think, John, it came back to timing, the
fact that you have so much in the arbs hands.
J. Tamaso Okay, thank you.
P. Lassonde Yes, John, the arbitrators really don't care who
wins. To them, it's so many percent per month. With
the number of shares, we're told 25% plus or minus
5%, it's a big number. We just have to live with that
reality.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 18
The other thing, which is very real as well, is the
South African rand is the second worse performing
currency in the world this year, after the Turkish
lira. Now I haven't checked the Afganeeze currency,
but certainly the ones that we do know. I mean the
currency has fallen over 40% since April of a year
ago.
But what's pernicious about this thing is that for
the South African institutions who are trying to
basically save some of their savings, the stocks that
have revenues in U.S. dollars are the only way that
they can do something. So the ironic effect is that
the Anglo Gold stock has been going up on internal
South African buying, is our view. But that's only
going to last - that's a short-term phenomenon.
In the long run, we all know that when a currency
goes south the way that this one has, it's big
trouble. But we've got to deal with the next two
weeks, and that's what's happening.
J. Tamaso Thank you.
Coordinator Our next question comes from Terrence Orsland from
TSO Associates.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 19
T. Orsland Thanks. Good morning, guys. Wayne, have you mentioned
that you've touched base with the rating agencies
with respect to Newmont paper and the merging company
paper, whether you got their blessing or not? Number
two, I'm kind of mystified by the gold price reaction
here with respect to what you guys want to do with
the hedge book and all, and the gold price seems to
be totally shrugging it off. Any comments, Pierre?
W. Murdy I think first of all, yes, we made contact before
with the rating agencies and we're scheduled to meet
with them again this week. But again, we don't see
that as a major issue because of the strong coverage
ratios that the combined company has.
P. Lassonde In terms of the gold market, Terry, I think that the
market is probably looking at it as "the proof is in
the pudding". You know, once Newmont has wrapped up
this deal and instituted the policies, then I think
you're going to see an effect. But until then, the
market is going to look at it and just say, "Show
me." So it's a question of time here; that's our
view.
T. Orsland Fair enough. Thanks.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 20
Coordinator Our next question comes from Katherine Sterritt from
Scotia Capital.
K. Sterritt Good morning. I wondered if you could expand a little
bit on the hurdles that you have to go through in
order to complete your transaction mid-February? I
have to admit that it sounds aggressive to me, just
given the precedent of Varic Home Stake going through
the SEC and the bottlenecks they encountered. I
wondered how you thought your process would be
faster?
W. Murdy I guess I would, in commenting on that - the filings
that we have to go through is basically the bitter
statement here, which we expect to file within a
week. Then the documentation and the court hearings
for the Franco vote.
I think with respect to Newmont and the SEC, the SEC,
about a year and half ago, had a major change in
personnel in the mining section. The new personnel
have been going through each company that has filed
with them, with a, I will call it, fine toothed comb.
The advantage we have is that we
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 21
went through that earlier this year when we did the
Battle Mountain transaction.
We had an extremely thorough review; it took many
months longer than what we expected, but we went
through that. We had no revisions to reserves. We
made some minor changes in some of our accounting
policies on revenue recognition. But since we've been
through that process, that's why we feel highly
confident that we won't have that kind of issue
again.
K. Sterritt Okay. So you're thinking that the delay was more of
the microanalysis that was taking place on the major
company, as opposed the Australian Gap issues on
accounting for reserves?
W. Murdy Yes. Well, it wasn't Australian issues on reserves,
but they went through everything and they did that
again on Varic Home Stake. I think if you talk to the
people there, they'll tell you that there were a lot
of issues in that, that they went through, and it
just takes time. But we have been through that
process.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 22
With respect to Normandy's reserves - reserves in
Australia, the standards here on reserves are very
tight. Our people were very comfortable with
Normandy's reserves. The resources are a matter that,
or the standards, we would say, are a little less
stringent than what we require internally. But that
you can't, with SEC filings, you can't disclose
resources anyway, so we think that that will be a
moot issue.
K. Sterritt Okay. Thank you, very much.
Coordinator Our next question comes from Tom Collar from Morgan
Stanley.
T. Yanko Yes, it's Tom Yanko at Morgan Stanley. It says that
the transaction is conditioned upon there not being a
material adverse change in Normandy. I believe that
on the last conference call you said that the price
of gold would not be considered for the purpose of
deciding whether there's been a material adverse
effect at Normandy. Is that the case in this bid as
well?
W. Murdy Yes, that's basic documentation that we had entered
into with Normandy in the merger agreement.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 23
T. Yanko Okay, will the bidder statement that comes out in a
week or so, will that clearly outline that there is
an exclusion of a drop in the price of gold?
W. Murdy Yes. Or an increase.
T. Yanko Okay. We're not so concerned about an increase. The
other thing - just a point, if this issue about the
timing of a mid-February closing becomes something
that Anglo Gold debates. One thing that companies do
is assume that risk and put in some sort of an
interest rate factor if it goes beyond a targeted
timing date. If that becomes an issue that's being
debated in the market, that you could address that
and take that risk and compensate the Normandy
shareholders for any unexpected delay. Thank you,
very much.
W. Murdy Thank you.
Coordinator The next question comes from John Duty from Gold
Stock Analysts.
J. Duty Boy it seems like there aren't too many people on the
call this morning and you guys are the ones up early
or late, whatever the case is. I wonder,
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 24
actually my question was answered. It had to do with
the SEC clearance time, and it was certainly well
answered. Thank you.
W. Murdy Thank you.
Coordinator Our next question comes from Kerry Smith of Heywood
Securities.
K. Smith Good morning, Wayne - a quick question on the
rationalization that Pierre talked about. Could you
give us some idea as to the rationalization that you
plan to complete post the merger, in terms of how
much production you think would fall off the table
through the rationalization process?
W. Murdy Yes. I think if you go to the material that's on the
Web site, we talk about, on page five, our asset
portfolio and we've tried to indicate which we
consider core assets and which we consider strategic
and then we've labeled others. In fact, within the
Normandy group, if you eliminated all of the others,
which is not necessarily what we would do, you're
talking about less than 200,000 ounces.
K. Smith Okay. Thanks.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 25
Coordinator Our next question comes from Adam Dosavitch from
Pollack Company.
M. Pollack Hi, there, it's actually Murray Pollack. Adam asked
me to step in here for a moment. Question - assuming
this transaction is completed, Newmont will have
acquired, over the last several years, Santa Fe,
Battle Mountain, Hemlow and now Normandy. A
tremendous number of operating mines in total. Does
management contemplate any streamlining once this
acquisition is complete? Please comment.
W. Murdy Yes, absolutely. When we talk about rationalization,
again, what we focus on in the company is being in
relatively few areas that are substantial gold
producing regions. So the focus of the company is
then in Nevada, clearly the Yanna Coacha region in
South America, in Peru and these assets in Australia.
But there are a number of assets that we label as
non-strategic or non-core and we would look at
extracting value, utilizing the skill sets of the
merchant banking group out of Franco to exit those
over a period of time.
M. Pollack Thank you.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 26
P. Lassonde Let me just add, Murray, you probably do not have the
Grant Samuel report, but all of the Normandy
shareholders would have that report. I just mention
it because they did evaluation of all the Normandy
assets for the board, to respond to the Anglo Gold
original offer. If you look at the value that they
put on that 10% of assets that Wayne was mentioning,
you come up with a value in the range of U.S. $650
million to $850 million.
Certainly we would not dispute that. We have looked
at that very carefully and I think that the role of
the Merchant Banking Division at Franco will be to
take some of these assets and create real value.
We're looking forward to that challenge. I think it's
going to be something where we can add a lot of value
to Newmont.
M. Pollack Thank you.
Coordinator Our next question comes from John Bridges from JP
Morgan.
J. Bridges Hi, good morning, congratulations. I just wondered if
you'd spoken about the rationalization and asset
sales. I wonder if you can give us some
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 27
indication as to the order of magnitude of what sort
of amount you'd be looking for from those sales?
P. Lassonde I think, John, I just mentioned what the Grant Samuel
report had. I think we think it's a good start. We
think that there are a couple of assets that we
could, very quickly, in the space of a few months,
get in the order of $250 million to $350 million. The
goal here would be to get right back to where we were
in terms of the debt ratio, 18%. Then over the next
18 months, to continue rationalization of the assets.
A lot of the assets take people; they take management
time and they will not be part of the long-term core
assets.
So we're not going to fall in love with any assets.
We're going to very objectively look at them, see how
they fit in the corporate goals going forward and
maximize the value for the Newmont shareholder.
J. Bridges So some of these things offer a win/win.
P. Lassonde I would think so. I think it's going to be not only a
win for Newmont, but what we're really going to try
to do is work with medium-sized,
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 28
intermediate sized companies and create a win/win for
both companies. Because there is, in our view, a need
for some of these assets to get down, what we would
call the "food chain". Some of the very good
intermediate companies are in, I would say, need of
good projects. There are a number of really good,
decent projects in this asset rationalization program
that would better fit somebody else. So you work with
them and you can create a win/win situation.
J. Bridges Okay great. Thank you.
Coordinator Our last question comes from Adrian Day from Global
Strategic Management.
A. Day Yes, good morning and good afternoon. I have a
question about the portfolio management aspect of
this, going forward. I know for myself, these three
companies, Franco, Newmont and Normandy happen to be
three of my four largest gold holdings. So going
forward, obviously, that presents a bit of a
difficulty for me, and I'm sure I'm not alone. I'm
wondering if you could comment on that and, in
particular, if you've seen any indications, recently,
that the generalists are buying gold?
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 29
P. Lassonde Adrian, I don't know. You've got to be one of the
only ones that can pick three tremendous gold stocks
like that.
W. Murdy Clearly the discussions that we've been having and
what we've seen are the generalist funds buying into
the stock. We saw that, really, for the better part
of this year. Substantial increased holdings by some
of the major, major funds that have held us in the
past. It's clearly coming from the generalist funds.
I think on our road show we are talking to people,
certainly we get the portfolio managers that deal
with natural resources in a broader sense, but we're
also seeing a broader spectrum of portfolio managers.
So there's a lot of interest out there. Again, I
think it's portfolio diversification. The times have
changed. The bull market of the last ten years is
over and people are looking for real diversification
in their portfolio and this stock clearly does that.
A. Day Okay, great. Thanks.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 30
P. Lassonde I think, Adrian, that problem would have been acute
when the gold funds represented a major force in the
business. But you know, in the last five years the
assets of those funds have diminished quite a bit. So
we find that there's not a tremendous amount of
overlap and we don't see that as an issue, really.
A. Day Okay. Thanks.
W. Yang Thank you, very much, ladies and gentlemen. I just
want to point out that the replay number for this
call is 1-800-280-4691 in the U.S. and the
international number for replay is 402-220-9723.
We also invite you to our Web site at www.newmont.com
for a North America presentation that is up on the
Web site. There is also an Australian presentation on
the Web site, as well.
Thank you for joining us today.
NEWMONT MINING CORP.
MODERATOR: WENDY YANG
DECEMBER 10, 2001/7:30 A.M. CST
PAGE 31
Coordinator Thank you. That concludes today's conference call.
All participants, you may disconnect at this time.