Business & Finance

Normandy Mining Limited, Franco-Nevada Complete Transaction

Business Wire - May 31st, 2001

Normandy Mining Limited (Normandy)(ASX:NDY) expressed their satisfaction in today's announcement that the transaction with Canadian Franco-Nevada Mining Corporation Limited (Franco-Nevada) has been successfully completed, with 99.7 percent shareholder approval.

Pierre Lassonde, President and co-Chief Executive Officer of Franco-Nevada, will join the Normandy Board as a non-executive Director, effective immediately, adding great depth and experience to the Board.

The transaction comprised the issue to Franco-Nevada of 446.1 million new Normandy shares (representing 19.99% of Normandy's capital after the issue) in exchange for:

1. The Midas gold mine in northern Nevada, USA, which commenced production in 1999 and currently produces approximately 250,000 gold equivalent ounces per annum at a cash operating cost of US$110-115 per gold equivalent ounce;
2. 105 square kilometres of tenements adjoining the Midas mine on the highly prospective Carlin Trend of northern Nevada;
3. The Australian royalty business of Franco-Nevada, including royalties over the New Celebration gold mine in Western Australia and the Henty gold mine in Tasmania; and
4. US$48 million cash (equivalent to approximately A$100 million), which will be used to retire debt.

For accounting purposes, a price of A$0.95 per share was allocated to the shares issued to Franco-Nevada.

Toronto, Canada based Franco-Nevada has been known to us for many years and is an extremely strong company with a market capitalisation of US$2.0 billion and over US$650 million in working capital and non-strategic investments, and no debt. As the world's leading royalty business, Franco-Nevada holds royalty interests over many of the world's best known and most productive gold mines.

The transaction and the alliance that Normandy has established with Franco-Nevada have been well received by both the investment community and financial media, with Normandy strongly positioned moving forward.

Normandy, Australia's largest and the world's sixth largest gold producer, remains focused on the key objectives of asset augmentation, business simplification and debt reduction to deliver strong returns to shareholders.