A near-$30 billion takeover bid for Newcrest Mining (NCM) finally recognises the value of the Australian gold miner, after months of back and forwards with US gold giant Newmont (NEM), according to Morningstar equity analyst Jon Mills.

Under Newcrest’s revised “best and final offer” shareholders would receive 0.4 Newmont shares for every Newcrest share they hold.

Share for share, that equates to around $30.96 per Newcrest share based on Newmont's recent trading levels. In addition, Newmont will allow Newcrest to pay a further fully franked special dividend of up to about $1.67 (US$1.10), without reducing its offer, taking the value to $32.63 per share and above Morningstar’s fair value estimate.

Newcrest has agreed to grant exclusive due diligence to Newmont, a move Mills says signals a deal is likely to occur and a competing proposal is unlikely.

“We think Newmont's higher proposal is attractive, representing a roughly 19% increase on its previous proposal and a 5% premium to our previous fair value estimate of $31,” he says.

“In our view the higher proposal recognises the value in Newcrest, including the likely recovery in production at its flagship Lihir mine in Papua New Guinea and its Brucejack mine in Canada along with its extensive growth pipeline.”

If a deal is finalised, Newcrest shareholders would own around 31% of the combined group. Following a potential deal, Newmont also plans to list its shares on the ASX.

The revised bid comes two months after Newcrest’s board rejected Newmont’s initial ‘opportunistic’ takeover bid, when Newcrest shares had been hit by leadership departures and ongoing operational issues.

Under the original offer, shareholders were set to receive 0.38 Newmont shares for each Newcrest share they own.

The previous deal valued each Newcrest share at about $27.45, undervaluing the company by around 13% based on Morningstar’s fair value estimate at the time of $31 per share.

Shares in Newcrest surged nearly 10% on news of the bid in February and bumped another 6% higher this week following the new offer.

Shares in the company have been driving higher since the prospective deal was announced—propelled in part by a climbing gold price. Newcrest shares are up more than 40% year-to-date.

Newmont's offer remains subject to due diligence, Newcrest shareholder approval and other conditions.