Gold miner Newmont set to acquire Newcrest Mining in $19.2 billion deal

The Yahoo Finance Live team breaks down the $19.2 billion deal from gold miner Newmont to acquire Newcrest Mining.

Video transcript

- Let's get to the big merger that we are hearing about in the gold space today. Newmont Mining has security $19.2 billion deal to acquire its Australian rival, Newcrest Mining. That deal is pending regulatory approval. But it does mark the largest deal ever in the gold mining sector. This is something that's been talked about now for a little bit here. It was public that Newmont was pursuing Newcrest here. And the initial proposal was made back on February 5.

So this is about a 30% premium at this deal price to where it was trading right before that deal was first proposed. In addition to beefing up the gold mining capability for Newmont, this also increases its exposure to copper. Newmont's, the real bulk of its revenue does come from gold, about in the 80% to 90% range. Whereas Newcrest also is very reliant on gold but has a little bit more of a copper operation, too.

- Yeah, and within the need or the push for more copper, you think about the areas within even the Inflation Reduction Act that had carved out space for electric vehicles to really get even more of a credit and/or not just credits, but even more of the build out and where copper comes into play for so many of those batteries as well. But then also, you think about the prices that we had seen in gold. Gold is still, if I remember correctly, hovering, or near the ballpark of some of those record highs, too. So all of this taking place as you're taking a look at gold futures right now sitting above $2,000 at this point

- Wow. Yeah.