weather icon Clear

Nevada’s 2 biggest gold producers may merge

Nevada’s two largest gold producers might merge, creating a global, $40 billion mining behemoth.

Barrick Gold Corp. said it is considering making a hostile offer for its biggest competitor, Newmont Mining Corp.

“Barrick Gold today confirmed that the company has reviewed the opportunity to merge with Newmont Mining in an all-share, nil-premium transaction. No decision has been taken at this time,” Barrick said in a statement Friday in response to media rumors of a tie-up.

Barrick’s interest comes as Newmont seeks to buy Goldcorp to become the world’s largest producer of the precious metal. Newmont declined to speculate on Barrick’s interest and said it is pushing ahead with the Goldcorp deal.

“We remain confident that the combination of Newmont and Goldcorp represents an unparalleled opportunity to create value for our shareholders and deliver industry-leading returns for decades to come,” Newmont spokesman Omar Jabara said in a statement.

Barrick and Newmont are the two largest publicly-traded gold producers with a combined 2017 output of more than 10 million ounces of gold. Barrick has a market capitalization of $23 billion, and Newmont is valued at $19 billion.

Though Barrick is headquartered in Canada and Newmont in Colorado, both companies have extensive operations in Northern Nevada, the largest gold-producing region in America.

“A combined Barrick and Newmont could potentially realize significant synergies in Nevada, although Newmont has downplayed these synergies in the past,” Jefferies Group analysts Christopher LaFemina and Patricia Hove said in a note Friday.

Barrick develops the Cortez and Goldstrike properties near Elko, employing 3,000 employees and 800 contractors. Barrick’s Nevada unit produced 2.1 million ounces of gold last year.

Newmont produced about 1.7 million ounces in Nevada last year. Barrick and Newmont are jointly developing the Turquoise Ridge underground gold mine in Golconda.

The gold industry is undergoing consolidation to cut costs and boost profitability as the price of the precious metal has failed to surpass $1,400 an ounce in more than five years.

Barrick last year merged with Randgold Resources, and Newmont recently has made an offer for Goldcorp.

“Making acquisitions to become bigger might not be correlated with higher share prices, but we believe the status quo was not an option. We expect more M&A in the space,” the Jefferies analysts said.

Don't miss the big stories. Like us on Facebook.
Nye County unemployment falls in May

Unemployment rates in Nevada continued to fall in May, according to data released by the Department of Employment, Training and Rehabilitation on Tuesday.

Apprenticeship programs get $130 million in federal grants

The U.S. Department of Labor on Tuesday announced the award of more than $130 million in grants to develop, modernize and diversify Registered Apprenticeship programs in 15 states and to establish Registered Apprenticeship Technical Assistance Centers of Excellence in three states and the District of Columbia to provide technical expertise and services and accelerate the expansion of Registered Apprenticeship programs.

State initiative launched to aid birthing hospitals

The Maternal, Child and Adolescent Health Section of the Nevada Division of Public and Behavioral Health on Wednesday announced the kickoff of the Nevada Alliance for Innovation in Maternal Health, one of many statewide efforts to end preventable maternal mortality and severe maternal morbidity and comes on the heels of numerous legislative efforts to improve birth outcomes in Nevada.

GOED division assisted 39 Nevada companies

The Governor’s Office of Economic Development International Trade Division used its U.S. Small Business Administration State Trade Expansion Program grant to help 39 Nevada companies during the past year.

StartUpNV lauds new law to encourage investment

StartUpNV, a nonprofit statewide incubator and accelerator for Nevada-based startup companies, staunchly supported the passage of SB9 to modernize Nevada’s private investment laws that were burdensome, confusing and an impediment to enticing investment in local startup companies.

Las Vegas tourism industry expected to surge back from pandemic plunge

UNLV’s Center for Business and Economic Research predicts that visitor volume in Southern Nevada will climb 57 percent this year and 13.2 percent next year, following its 55.2 percent drop in 2020.