A group of Newmont creditors are trying to block an amendment the mega-gold miner is seeking for a large tranche of notes associated with its operations in Nevada, according to people with knowledge of the matter. The change would prevent liability for those bonds from shifting to Barrick after the companies’ recently announced joint venture in the state is completed.
The 2035 bonds are guaranteed by Newmont USA Ltd., which includes the three Nevada gold mines set to become part of the JV with Barrick. Those assets accounted for about 88 percent of the guarantor’s proven and probable reserves within North America at the end of last year, and the proposed JV would constitute a sale of “all or substantially all” of the guarantor’s assets in Nevada, per the bond prospectus.
The relationship between Newmont and Barrick, the world’s two largest gold miners, has been fraught for years. Merger talks between the two companies have failed in the past, as have attempts to increase cooperation in Nevada. The joint venture agreement was only reached after Barrick launched, and agreed to withdraw, a hostile bid for Newmont.
The expiration date comes on the same day that Credit Roundtable, a bondholder industry advocacy group, gathers for its semiannual meeting in Washington. The meeting started at 8:30 a.m. and Newmont had come up in conversation within minutes, according to David Knutson, co-leader of the group.