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
[FRANCO-NEVADA LETTERHEAD]
November 14, 2001
Dear Shareholders:
Today we announced a proposal to merge Franco-Nevada with Newmont Mining and
Normandy Mining to create the number one gold company in the world. The attached
information provides the highlights of this transaction. The resulting company
will be:
o #1 in gold reserves (97 million ounces)
o #1 in gold production (8 million ounces per year)
o #1 in leverage to gold among the majors with a "no-hedging" philosophy
o #1 in trading liquidity
o #1 in EBITDA
Since we co-founded Franco-Nevada in 1982, we have consistently shared the goal
of maximizing shareholder value. As Franco-Nevada's largest individual
shareholders, we are committed to continue doing just that. We believe in gold
and this transaction will give our new company the greatest leverage to gold
possible. Our new roles will be Pierre as President of the merged company and
Seymour as Chairman of the merged company's Merchant Banking unit.
In the proposed transaction, Franco-Nevada shareholders will receive for each
Franco-Nevada share their choice of 0.80 of a Newmont share or 0.80 Canadian
exchangeable share (which will then be exchangeable for 0.80 of a Newmont
share). This is intended to be a tax-free rollover for Canadian and US
shareholders and the exchangeable shares will trade in Canada and are intended
to qualify as Canadian property. The implied price of the deal is C$28.36 per
Franco-Nevada share or 22% above yesterday's share price. We expect some
temporary weakness in the stock while arbitrageurs take positions. We believe
with an improvement in the gold price, Franco-Nevada's resulting share price
will be substantially higher than it would be on a stand-alone basis.
Franco-Nevada shareholders initially will own approximately 32.5% of the
combined company's common and exchangeable shares. On a per share basis,
Franco-Nevada shares will have more than 3 times the attributable reserves and
gold production. This transaction will be immediately accretive to
Franco-Nevada's cash flow per share and substantially accretive to headline
earnings at higher gold prices. Approximately 70% of reserves and production for
the combined company will be from North America and Australia. The merged
company intends to continue our policy of remaining financially strong and will
adopt a "no-hedging" philosophy with respect to gold.
We expect to be sending you a management information circular for a special
shareholders' meeting expected to take place early next year. Please take time
to review the enclosed information and the circular that will follow. In the
meantime, accept our thanks for your continued support as Franco-Nevada enters a
new and exciting stage.
Sincerely,
/s/ Seymour Schulich /s/ Pierre Lassonde
Seymour Schulich Pierre Lassonde
Chairman and Co-CEO President and Co-CEO
[NEWMONT MINING CORPORATION LOGO]
[FRANCO-NEVADA MINING CORPORATION LTD. LOGO]
[NORMANDY MINING LIMITED LOGO]
SAFE HARBOR STATEMENT
--------------------------------------------------------------------------------
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
The following 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 that are intended to be covered by the safe harbor for
"forward-looking statements" provided by the Private Securities Litigation
Reform Act of 1995. 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 "expect," "anticipates," "believes,"
"intends," "estimates" and similar expressions. The forward-looking information
and statements in this presentation 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 their proposed transactions, Newmont Mining Corporation will
file a proxy statement and a registration statement with a prospectus with the
U.S. Securities and Exchange Commission. INVESTORS AND SECURITY HOLDERS ARE
ADVISED TO READ THE PROXY STATEMENT AND THE PROSPECTUS WHEN THEY BECOME
AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and
security holders may obtain free copies of the proxy statement and the
prospectus (when available) and other documents filed by Newmont with the
Commission at the Commission's web site at http://www.sec.gov. Free copies of
the proxy statement and the prospectus, once available, 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 foreign filings may be obtained at http://www.sedar.com.
PARTICIPANTS IN SOLICITATION
Newmont Mining Corporation and its directors, executive officers and other
members of its management and employees may be soliciting proxies from its
stockholders in connection with the transactions. Information concerning
Newmont's participants in the solicitation is set forth in Newmont's Current
Report on Form 8-K filed with the Commission on November 14, 2001, as amended.
NEWMONT + NORMANDY + FRANCO-NEVADA =
THE NEW GOLD STANDARD FOR THE 21ST CENTURY
[NEWMONT MINING CORPORATION LOGO]
[FRANCO-NEVADA MINING CORPORATION LTD. LOGO]
[NORMANDY MINING LIMITED LOGO]
Summary version of the November
14, 2001 joint corporate presentation.
The full presentation can be found at
www.franco-nevada.com
[NEWMONT MINING CORPORATION LOGO]
[FRANCO-NEVADA MINING CORPORATION LTD. LOGO]
[NORMANDY MINING LIMITED LOGO]
NEWMONT + NORMANDY + FRANCO-NEVADA =
THE NEW GOLD STANDARD FOR THE 21ST CENTURY
--------------------------------------------------------------------------------
THE NEW GOLD STANDARD
--------------------------------------------------------------------------------
* # 1 in reserves * Balance sheet strength
* # 1 in gold production * Low cash costs
* # 1 in leverage to gold * Balanced political risk
* # 1 in trading liquidity * Management Strength
* # 1 in EBITDA * "No Hedging" philosophy
* U.S. domicile
SUMMARY TRANSACTION OVERVIEW
--------------------------------------------------------------------------------
NORMANDY TRANSACTION
o 0.0385 Newmont shares per Normandy share, plus A$0.05 per share cash payment
upon 90% acceptance
- Implied offer price per share of A$1.70 based on closing stock prices and
the A$ exchange rate on Tuesday, November 13
- Premium of 21% over AngloGold's implied offer price
- 50.1% minimum acceptance condition
- Normandy shareholders to own 18% of Newmont pro forma
- Tax free with 80% tender
- Newmont to seek listing on ASX
FRANCO-NEVADA TRANSACTION
o 0.8000 Newmont shares or Canadian exchangeables per Franco-Nevada share
- Implied price of C$28.36
- Premium of 22% over Franco-Nevada's market price prior to announcement
- Franco-Nevada shareholders to own 32% of Newmont pro forma
- Exchangeables are tax free
- Exchangeables to trade on Toronto Stock Exchange
EXPECTED $70-$80 MILLION ANNUAL AFTER-TAX SYNERGIES IN FIRST FULL YEAR
RECOMMENDED AND SUPPORTED BY ALL THREE BOARDS OF DIRECTORS
19.9% OF NORMANDY SHARES ALREADY COMMITTED TO THE NEWMONT BID
-------------------------------------------------------------------------
| For futher information about Newmont, Normandy, Franco-Nevada |
| and this transaction, including the complete presentation, go to |
| www.newmont.com, www.normandy.com.au or www.franco-nevada.com. |
-------------------------------------------------------------------------
[NEWMONT MINING CORPORATION LOGO]
[FRANCO-NEVADA MINING CORPORATION LTD. LOGO]
[NORMANDY MINING LIMITED LOGO]
THE NEW GOLD STANDARD FOR THE 21ST CENTURY
--------------------------------------------------------------------------------
o THE NEW INDUSTRY LEADER
--------------------------------------------------------------------------------
[Graph]
2001E PRODUCTION (MM OZ.) v.
ENTERPRISE VALUE (US$ MILLIONS)
-------------------
| Size of circles |
| proportionate to |
| reported gold |
| reserves |
-------------------
2001E Production Enterprise Value
Gold Fields [Medium Circle] 3.7 MM oz. 2,075.7 million
Placer Dome [Small Circle] 2.9 MM oz. 4,120 million
Anglo Gold [Medium Circle] 7.04 MM oz. 4,500.6 million
Barrick/Homestake [Medium Circle] 6.1 MM oz. 8,469.7 million
Newmont PF (1) [Large Circle] 8.2 MM oz. 9,800 million
o LARGEST GLOBAL LAND POSITION
--------------------------------------------------------------------------------
[World Map]
[North America] NEVADA 34MM OZ. RESERVE BASE
----------------------------
[South America] YANACOCHA 19MM OZ. RESERVE BASE
-------------------------------
[Australia] WESTERN AUSTRALIA 14MM OZ. RESERVE BASE
---------------------------------------
Tanami 3mm oz. reserve base
[Indonesia] Batu Hijau 7mm oz. reserve base
TOTAL OF 94,000 SQ. MILES (244,000 SQ. KM)
3 MAJOR GOLD REGIONS = 86% OF RESERVES
o COMPANY SUMMARY
--------------------------------------------------------------------------------
FRANCO-
NEWMONT NORMANDY NEVADA NEWMONT PF
Local currency share price (11/13/01) US$22.25 A$1.44 C$23.30
Diluted shares outstanding (millions) 197.0 2238.2 160.4
MARKET VALUE OF EQUITY $4,383 $1,677 $2,326
(US$ MILLIONS)
Reserves (MM oz.) 66.3 26.4 4.4(1) 97.1 (1)
LTM production (MM oz.) 5.8 2.4 0.3(1) 8.6 (1)
LTM cash costs ($/oz.) 179 160 228(1) 175 (1)
LTM total costs ($/oz.) 209 224 291(1) 217 (1)
o PRO FORMA CREDIT STATISTICS
--------------------------------------------------------------------------------
NEWMONT NORMANDY FRANCO-NEVADA NEWMONT PF (2)
-------------------------------------------------------------------------------------------------
Cash and equivalents $98 $207 $547 $716
Total debt 1,282 700 0 1,982
Minority interest 231 41 0 271
Book equity 1,460 532 964 5,539
--------------------------------------------------------------
Net book capitalization 2,874 1,067 417 7,077 (4)
Net debt/net book capitalization (3) 41% 46% (131%) 18%
Net debt/LTM EBITDA 2.1x 1.8x (4.5x) 1.3x
1 Reflects proportional 49.5% ownership of Echo Bay
2 Net of transaction adjustments
3 Net book capitalization defined as net debt plus minority interest plus book equity plus preferred stock
4 Newmont PF book capitalization reflects Newmont's acquisition of Normandy and Franco-Nevada, Normandy capitalization pro forma
for the anticipated deconsolidation of Australian Magnesium Corporation and the acquisition of Otter Mines by Normandy NFM
[NEWMONT MINING CORPORATION LOGO]
[FRANCO-NEVADA MINING CORPORATION LTD. LOGO]
[NORMANDY MINING LIMITED LOGO]
THE NEW GOLD STANDARD FOR THE 21ST CENTURY
--------------------------------------------------------------------------------
o # 1 IN RESERVES
--------------------------------------------------------------------------------
[Bar Graph]
RESERVES
Million oz.
[American flag] Newmont PF (1) 97.1
[South African flag] AngloGold 87.6
[South African flag] Gold Fields (2) 79.0
[Canadian flag] Barrick/Homestake (3) 76.4
[Canadian flag] Placer Dome 47.0
o # 1 IN PRODUCTION (4)
--------------------------------------------------------------------------------
[Bar Graph]
2001E PRODUCTION
Million oz.
[American flag] Newmont PF (5) 8.2
[South African flag] AngloGold 7.1
[Canadian flag] Barrick/Homestake 6.1
[South African flag] Gold Fields 3.7
[Canadian flag] Placer Dome 2.9
o SIGNIFICANT CAPITAL MARKETS SCALE
--------------------------------------------------------------------------------
[Bar Graph]
ENTERPRISE VALUE with
Market Value and Net Debt
Market Value Net Debt
[American Newmont PF (6) $8.125 billion $1.59 billion
flag]
[Canadian Barrick/Homestake $8.417 billion $0.0527 billion
flag]
[South African AngloGold $3.636 billion $0.864 billion
flag]
[Canadian Placer Dome $3.678 billion $0.426 billion
flag]
[South African Gold Fields (2) $2.043 billion $0.1716 billion
flag]
o SUBSTANTIAL TRADING LIQUIDITY
--------------------------------------------------------------------------------
AVERAGE DAILY TRADING VOLUME (7)
[BAR GRAPH]
[AMERICAN FLAG] Newmont PF (8) $62 million
[CANADIAN FLAG] Barrick/Homestake (9) $58 million
[CANADIAN FLAG] Placer Dome $33 million
[SOUTH AFRICAN FLAG] AngloGold $15 million
[SOUTH AFRICAN FLAG] Gold Fields $7 million
1 Includes reserves of 66.3 mm oz. for Newmont, 26.4 mm oz. for Normandy,
2.2 mm oz. of equivalent reserves for Franco-Nevada and 2.2 mm oz. of
reserves to reflect Franco-Nevada's 49% ownership of Echo Bay
2 Pro forma for acquisition of WMC gold assets
3 SEC Filing of Nov 9, 2001
4 Pro forma for the acquisitions, Newmont will account for approximately 9%
of global gold production (Gold Fields Mineral Services)
5 Newmont includes production attributable to Franco-Nevada's share of Echo
Bay. Source: most recent public filings
6 Enterprise values as of 11/9/01; Newmont PF reflects the sum of Newmont,
Normandy and Franco-Nevada market values excluding the value of
Franco-Nevada's 19.9% stake in Normandy
7 Average daily trading volume for the six-month period ending Nov 9, 2001
8 Newmont PF calculated by adding the volumes of Newmont, Normandy and
Franco-Nevada
9 ABX/HM combined average daily volume presented is for the six months prior
to their merger announcement given substantial post-announcement arbitrage
activity
[NEWMONT MINING CORPORATION LOGO]
[FRANCO-NEVADA MINING CORPORATION LTD. LOGO]
[NORMANDY MINING LIMITED LOGO]
THE NEW GOLD STANDARD FOR THE 21ST CENTURY
--------------------------------------------------------------------------------
o STRONG BALANCE SHEET AND FINANCIAL FLEXIBILITY
--------------------------------------------------------------------------------
NET DEBT/NET BOOK CAPITALIZATION (1)
[BAR GRAPH]
[CANADIAN FLAG] Barrick/Homestake 1 %
[SOUTH AFRICAN FLAG] Gold Fields (2) 17%
[AMERICAN FLAG] Newmont PF (3) 18%
[CANADIAN FLAG] Placer Dome 24%
[SOUTH AFRICAN FLAG] AngloGold 41%
o LOW CASH COSTS
--------------------------------------------------------------------------------
CASH COSTS (4)
[BAR GRAPH]
[CANADIAN FLAG] Placer Dome $157/oz.
[CANADIAN FLAG] Barrick/Homestake $159/oz.
[AMERICAN FLAG] Newmont PF (5) $175/oz.
[SOUTH AFRICAN FLAG] AngloGold $192/oz.
[SOUTH AFRICAN FLAG] Gold Fields $196/oz.
o LARGEST UNHEDGED RESERVE BASE
--------------------------------------------------------------------------------
UNHEDGED RESERVES
[BAR GRAPH]
Increasing gold exposure
as hedge book is
unwound
[AMERICAN FLAG] Newmont PF (6) $84.9 million oz. 12.2 million oz. (7)
[SOUTH AFRICAN FLAG] Gold Fields $78.8 million oz.
[SOUTH AFRICAN FLAG] AngloGold $71.3 million oz.
[CANADIAN FLAG] Barrick/Homestake $54.3 million oz.
[CANADIAN FLAG] Placer Dome $41.0 million oz.
o SUBSTANTIAL LEVERAGE TO GOLD
--------------------------------------------------------------------------------
ESTIMATED INCREASE IN ANNUAL PRE-TAX CASH FLOW FROM US$25 INCREASE IN
GODL PRICE(8)
[BAR GRAPH]
[AMERICAN FLAG] Newmont PF $162 million
[SOUTH AFRICAN FLAG] Gold Fields $90 million
[SOUTH AFRICAN FLAG] AngloGold $39 million
[CANADIAN FLAG] Placer Dome $36 million
[CANADIAN FLAG] Barrick/Homestake $25 million
1 Net book capitalization defined as book value of equity plus net debt plus
minority interest and preferred stock; as of Sept 30, 2001
2 Pro Forma for acquisition of WMC gold assets
3 Newmont PF book capitalization reflects Newmont's acquisition of Normandy
and Franco-Nevada, Normandy capitalization pro forma for the anticipated
deconsolidation of Australian Magnesium Corporation and the acquisition of
Otter Mines by Normandy NFM
4 For the latest twelve months ended Sept 30, 2001
5 Inclues proportional costs for 49% ownership in Echo Bay
6 Includes attributable reserves of Franco-Nevada and Echo Bay
7 Total Newmont PF committed ounces, excluding Echo Bay
8 US$25 x unhedged 2001E production for a gold price increase from $275 to
$300
[NEWMONT MINING CORPORATION LOGO]
[FRANCO-NEVADA MINING CORPORATION LTD. LOGO]
[NORMANDY MINING LIMITED LOGO]
THE NEW GOLD STANDARD FOR THE 21ST CENTURY
--------------------------------------------------------------------------------
o UPSIDE POTENTIAL
--------------------------------------------------------------------------------
ADJUSTED ENTERPRISE VALUE PER PRODUCTION OUNCE (1)
$US
[Bar graph
Barrick/Homestake: $1,356.90
Newmont PF: $1,118.80]
ADJUSTED ENTERPRISE VALUE PER PRODUCTION OUNCE(1)
$US
[Bar graph
Barrick/Homestake: $107.00
Newmont PF: $97.70]
PRICE/LTM CFPS(2)
[Bar graph
Barrick/Homestake: 11.70x
Newmont PF: 10.80x]
o WHY GOLD IS GOING UP
--------------------------------------------------------------------------------
o PRODUCER HEDGING IS DECREASING (4)
[Bar graph]
1992: 135 tonnes of gold
1993: 142 tonnes of gold
1994: 105 tonnes of gold
1995: 475 tonnes of gold
1996: 142 tonnes of gold
1997: 504 tonnes of gold
1998: 97 tonnes of gold
1999: 506 tonnes of gold
2000: (10) tonnes of gold
2001F: (30) tonnes of gold
o SUPPLY IS DECREASING (4)
[Bar graph]
Mine production Official Sector Old Gold Net Producer Implied Net
Year Sales Scrap Hedging Disinvestment Total
1997 2479 326 628 504 297 4,234
1998 2538 374 1,097 97 0 4,106
1999 2568 464 616 506 0 4,154
2000 2576 471 607 0 316 3,970
2001 2604 487 652 0 102 3,845
o FINANCIAL DEMAND IS INCREASING
DOW JONES INDEX/GOLD PRICE (1886-2001)
[LINE GRAPH SHOWING DOW JONES INDEX/GOLD PRICE FOR THE YEARS FROM 1886 TO
2001 (IN EIGHT YEAR INCREMENTS) STARTING WITH APPROXIMATELY 1.5 AND
ENDING WITH APPROXIMATELY 36. THE FOLLOWING SPECIFIC POINTS WERE MARKED:
APPROX. YEAR : INDEX (US$/OZ)
1899 : 1.01
1926 : 18.40
1934 : 2.01
1966 : 28.28
1982 : 1.04
1996 : 41.67]
1 Newmont PF reflects the sum of Newmont, Normandy and Franco-Nevada
enterprise values as of Nov 9, 2001 (adjusted enterprise value excludes
Franco-Nevada's publicly traded equity interests in Aber Resources and
Metallica)
2 Last twelve months as of Sept 30, 2001
3 Newmont PF includes attributable reserves and production of Franco-Nevada
and Echo Bay
4 Source: GFMS data