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
[NEWMONT MINING CORPORATION LOGO]
[FRANCO-NEVADA MINING CORPORATION LTD. LOGO]
[NORMANDY MINING LIMITED LOGO]
NEWMONT
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MINING CORPORATION
1700 Lincoln Street
Denver, Colorado 80203
USA
(303) 863-7414
16 January 2002
Dear Normandy Shareholder:
You have received two offers to acquire your shares, one from Newmont Mining
Corporation and the other from AngloGold Limited.
When AngloGold's offer was to expire last Friday, holders of almost 94% of
Normandy shares did not accept AngloGold's offer. We believe that Normandy
shareholders overwhelmingly rejected AngloGold's offer for one simple reason.
Newmont's offer is clearly superior. It provides Normandy shareholders with:
o higher overall value,
o significantly more cash up front,
o the more secure and liquid security, and
o the opportunity to participate in the world's premier gold company, which
would also have the greatest leverage to the gold price.
THE HIGHEST PRICE
The implied value of the Newmont offer has, since its announcement, been higher
than the implied value of the AngloGold offer. Similarly, using market prices
for the shares of Newmont and AngloGold over the past 12 months, Newmont's offer
always has had a higher implied value than AngloGold's offer. Based on closing
prices on the New York Stock Exchange on 15 January 2002, our offer values your
Normandy shares at A$2.03*per share, while AngloGold's offer values those shares
at A$1.96* per share.
SIGNIFICANTLY MORE CASH
Newmont is offering A$0.50 cash per Normandy share - 67% more than the A$0.30
per share being offered by AngloGold - in addition to 0.0385 shares of Newmont
common stock for each Normandy share. This additional cash offered by Newmont
gives you greater certainty of value than that provided by AngloGold.
SIGNIFICANT TRADING LIQUIDITY
Newmont shares have approximately four times the average daily trading liquidity
of AngloGold's shares. This trading liquidity is important for you. The market
for Newmont shares has a much greater capacity to absorb the selling pressure
that typically accompanies the completion of stock-for-stock acquisitions.
Based on historic trading patterns, it would take about 17 months for the market
to absorb the shares to be issued under the AngloGold offer if all of those
shares were resold and those sales accounted for half of average daily trading
volumes. The comparable period for Newmont would only be about three-and-a-half
months.
Additionally, as a result of the trading patterns of index funds, we believe
that demand for Newmont stock should increase significantly upon completion of
Newmont's bid as those index funds increase their holdings of Newmont to match
its increased weighting in the S&P 500 Index. At the conclusion of the offer,
Newmont will also be listed on the ASX and it desires to provide a liquid market
for its securities.
Each of these factors is important to Normandy shareholders who should be
concerned about the liquidity of their investments.
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THE WORLD'S PREMIER GOLD COMPANY
When we announced our bid for Normandy, we also announced that we had entered
into an agreement that provides for our acquisition of Franco-Nevada Mining
Corporation. That acquisition is subject to certain conditions, including our
acquisition of a relevant interest in at least 50.1% of the Normandy shares
(including the 19.8% block that Franco-Nevada has committed to us). Our offer
for Normandy is not conditional on the acquisition of Franco-Nevada.
We believe that, after the acquisition of Normandy and Franco-Nevada, Newmont
will be the best gold company in the world and the best gold vehicle for
investors. Newmont will then:
o have the LARGEST RESERVE BASE AND HIGHEST PRODUCTION OF GOLD in the world,
o be ONE OF THE BEST CAPITALIZED gold companies, with the financial strength
to develop attractive projects and ability to significantly reduce debt over
time, even at current gold prices,
o benefit from a CONSISTENT BASE OF CASH FLOW (EVEN IN A LOW GOLD PRICE
ENVIRONMENT) generated by the high margin royalty and investment business of
Franco-Nevada, which will continue to operate as a separate division of the
combined company,
o operate a diversified portfolio of WORLD-CLASS OPERATIONS around the world
WITH LIMITED EXPOSURE TO POLITICAL RISK and with a focus on LARGE MINING
DISTRICTS,
o offer investors the most LEVERAGE TO THE GOLD PRICE of any major producer,
providing significant upside potential from gold price appreciation
(although Newmont also has significant exposure to a decrease in gold
price),
o have the ABILITY TO GROW our reserves and production through development of
attractive projects, application of innovative technology, continued
exploration and further industry rationalization, and
o have a unique management team with a PROVEN RECORD OF DELIVERING SHAREHOLDER
VALUE through GLOBAL EXPLORATION, DEVELOPMENT AND OPERATION, MERCHANT
BANKING AND MERGER INTEGRATION.
We are on track to complete both acquisitions in mid-February.
A NORTH AMERICAN RATING AND BETTER TOTAL RETURNS
Newmont is a U.S. domiciled company. Newmont, along with most other major North
American gold companies, generally trades at higher multiples than AngloGold.
This is due to a wide variety of factors including asset quality, economic and
political risk, exchange rate risk and trading liquidity. For example,
AngloGold's profitability and hedge book are subject to significant risk as a
result of their exposure to the Rand.
We strongly believe that having Normandy's earnings and assets valued using
Newmont's North American multiple creates significant potential for creation of
additional shareholder value.
In the three years to the date when AngloGold first announced its offer for
Normandy, through the appreciation of Newmont's share price and the payment of
dividends, Newmont has provided total returns to its shareholders that are more
than three times the returns provided by AngloGold.
WHAT SHOULD YOU DO?
Newmont's offer has been sent to, and can be accepted by, all Normandy
shareholders.
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Newmont already has almost 20% of Normandy's shares committed to its offer
through its agreement with Franco-Nevada. Additionally, subject to its fiduciary
duties, the Normandy Board has recommended that you accept Newmont's offer and
reject AngloGold's offer. The Directors of Normandy also have stated publicly
that they intend to accept Newmont's offer in respect of all of the Normandy
shares that they hold.
With this support and support from the shareholders and directors of
Franco-Nevada for Newmont's acquisition of Franco-Nevada, and receipt of most of
the required regulatory approvals for Newmont's acquisition of Normandy and
Franco-Nevada (including receipt of approval of Australia's Foreign Investment
Review Board this week), Newmont is on track to complete both acquisitions in
mid-February.
TODAY, MORE THAN EVER, THE COMPELLING CHOICE IS TO ACCEPT NEWMONT'S SUPERIOR
OFFER AND REJECT ANGLOGOLD'S OVERTURES. TO ENSURE THAT YOU CAN ACCEPT NEWMONT'S
OFFER, YOU SHOULD NOT ACCEPT ANGLOGOLD'S INFERIOR OFFER.
WHERE CAN YOU FIND MORE INFORMATION?
If you have any questions, you should call 1-800-507-507 IN AUSTRALIA
(TOLL-FREE), 61 2 9278 9331 OUTSIDE OF AUSTRALIA, AND 888-750-5835 IN THE UNITED
STATES AND CANADA (TOLL-FREE). We also invite you to visit our web site
(www.newmont.com), which includes updates and responses to frequently asked
questions. You can also visit the Normandy (www.normandy.com.au) and
Franco-Nevada (www.franco-nevada.com) websites for additional information.
We are very excited about this unique opportunity to combine our companies and
look forward to your participation as a shareholder of a New Newmont.
Sincerely,
/s/ Wayne W. Murdy
Wayne W. Murdy
Chairman and Chief Executive Officer
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* The implied value of Newmont's and AngloGold's offers will vary with the
market price of Newmont and AngloGold shares. You should obtain updated quotes
for Newmont, Normandy and AngloGold shares from your stockbroker or other
financial adviser.
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IMPORTANT NOTICE
Although the Normandy Board, subject to its fiduciary duties, has recommended
Newmont's offer to Normandy shareholders, Normandy has not provided unqualified
assistance to Newmont in making its offer. Among other things, Normandy has
refused to provide Newmont with certain financial information, and it has not
permitted its auditors to issue a consent in respect of financial information
relating to Normandy.
CAUTIONARY STATEMENT
This letter 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.
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 "expects," "anticipates," "believes," "intends," "estimates" and similar
expressions. The forward-looking information and statements in this press
release 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 the proposed transactions, Newmont Mining Corporation has
filed with the U.S. Securities and Exchange Commission a Registration Statement
on Form S-4 (which includes an Offer Document) and a Proxy Statement/Prospectus
on Schedule 14A. Investors and security holders are advised to read the Offer
Document and the Proxy Statement/Prospectus, which were mailed beginning on
January 11, 2002, because they contain important information. Investors and
security holders may obtain free copies of the Offer Document and the Proxy
Statement/Prospectus and other documents filed by Newmont with the Commission at
the Commission's web site at http://www.sec.gov. Free copies of the Offer
Document and the Proxy Statement/Prospectus 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
filings may be obtained at http://www.sedar.com.
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