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Pickens' Newmont Bid Suffers Setback

September 24, 1987|From Times Wire Services

WILMINGTON, Del. — A state Chancery Court here issued a temporary order Wednesday blocking Consolidated Gold Fields from buying additional shares in Newmont Mining, but the British mining house disclosed that it has already boosted its stake in Newmont to 49.6%.

The takeover attempt by Ivanhoe Partners, an investor group led by T. Boone Pickens Jr., also faced a fresh obstacle when Newmont declared a "poison pill" measure that would require an acquirer to pay the same price for all shares.

Under the plan, Pickens would have to give minority shareholders the same cash value for their stock that was paid to shareholders who tendered their stock earlier. That could make a takeover more expensive, since minority shareholders usually are paid a combination of cash and securities.

The Pickens group said a further court hearing will be held Friday at its request to examine whether huge stock purchases made on Tuesday by Consolidated, Newmont's biggest shareholder, should be left intact.

If the Consolidated Gold purchases of Newmont stock are allowed to stand, Pickens' attempt to gain control of Newmont would be virtually impossible, Wall Street traders said.

Judge Jack B. Jacobs' written statement said that nothing in his restraining order stopped the acquisition of shares prior to Wednesday morning.

The judge also set an Oct. 1 date for a hearing on a preliminary injunction sought by Pickens, who wants the court to invalidate an agreement between Newmont Mining and Consolidated that allowed the British mining concern to increase its stake in Newmont.

The Texas oilman and corporate raider wants the court to invalidate an agreement between Newmont Mining and Consolidated Gold that allowed the British mining concern to increase its stake in Newmont to 49.9% from 26.2%.

Consolidated Gold told the Securities and Exchange Commission late Wednesday that it now holds 49.6% of Newmont. It said it bought 15.6 million Newmont shares Tuesday at an average price of $98.25, a total cost of $1.53 billion.

Newmont and Consolidated Gold struck a deal earlier this week aimed at stopping Pickens' bid for Newmont.

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