Under the terms of the deal, Newmont will pay $820 million to AngloGold, as well as a 2.5% royalty for future gold production from underground ore. For AngloGold the deal represents an effort to reduce debt, while for Newmont this is an opportunity for the company to pick up an asset in its home state (Newmont is based in Greenwood Village, Colorado) and work on cutting the mine's expenses by a purported 10%. But for investors the deal represents risk -- gold prices have been in a multiyear decline, and Newmont is already carrying more than $6 billion in debt on its books. Just days later Newmont Mining closed a common stock sale that generated net proceeds of $674 million, which it plans to use to finance the AngloGold Ashanti deal. Of course, common stock offerings also dilute existing shareholders, further souring investors' initial perception of the deal.