Newmont makes an indicative $16.9 billion takeover offer for Australia's Newcrest

In this illustration, small toy figure and imitation gold are seen in front of the Newcrest logo.

MELBOURNE Reuters Global gold miner Newmont Corporation has made an indicative $16.9 billion takeover offer for Australia's No. Newcrest Mining Ltd., 1 goldminers, said on Monday in a deal that would leverage both the miners' operations in Australia and Canada.

Newcrest shareholders will receive 0.380 Newmont shares per every Newcrest share, which is a premium of about 21% to Newcrest's last closing value of A $22.450.

The Australian gold miner said that the Newcrest board, along with its financial and legal advisers, is considering the indicative proposal.

The deal would be attractive for Newmont, considering Newcrest's top class Cadia asset in Australia and its expanding footprint in North America, said senior investment officer Andy Forster of Argo Investments in Sydney.

It's probably a good timing. He said that Newcrest is a bit vulnerable at the moment with its leadership transition.

Newcrest is due to announce a new chief executive this year, after Sandeep Biswas said in December that he would retire from his position after eight years.

Sherry Duhe, formerly Chief Financial Officer, joined Newcrest in February last year, is an interim chief executive while a global internal and external search for a replacement is underway.

The Australian gold miner considers that the Australian gold miner wouldn't deliver sufficient compelling value to Newcrest shareholders and on that basis a rejected stock bid of 0.363 Newmont share per every Newcrest share.