Newmont Goldcorp sells Red Lake for $375 million plus $100 million in contigencies
Newmont Goldcorp (NYSE:NEM) unloaded its Red Lake complex to Evolution Mining, an Australian gold producer, for $375 million in cash and contingent payments of up to an additional $100 million tied to new resource discoveries.
The sale was announced today.
Under terms of the $100 million contingent payment, Newmont said that Evolution will pay $20 million for each one million ounces of new gold resources added to the existing Red Lake resource base over a fifteen-year period. The contingent payment is applicable to the first five million ounces of new resources.
Newmont said proceeds from the transaction will be used for "...returning cash to shareholders, maintaining an investment-grade balance sheet, and investing in a world-class portfolio."
Evolution Mining is an Australian gold producer with five operations: Cowal in New South Wales, Cracow, Mt Carlton and Mt Rawdon in Queensland, and Mungari in Western Australia.
Newmont acquired Red Lake from Goldcorp when the two companies merged earlier this year.