Newmont Mining Corp, the world's No. 2 gold producer, on Friday said it agreed to sell its royalty assets and other non-core investments to Franco-Nevada Corp in a deal worth about $1.3 billion.

Newmont also said it expects to record a pre-tax gain from discontinued operations of about $950 million in the fourth quarter after the sale is completed.

We remain focused on our core gold operations and intend to reinvest the proceeds to increase our gold price leverage for our shareholders, Chief Executive Richard O'Brien said in a statement.

Since succeeding Wayne Murdy as chief executive on July 1, O'Brien has focused on Newmont's gold mining activities. He eliminated the hedging book and moved to sell or spin-off its merchant banking business.

In connection with the deal, Pierre Lassonde stepped down from Newmont's board and will serve as non-executive chairman of Franco-Nevada's board.

Newmont acquired Franco-Nevada five years ago in a deal that also included the takeover of Australia's Normandy Mining.

On Thursday, Franco-Nevada said it priced an initial public offering of 72 million shares at C$15.20 each for proceeds of about C$1.1 billion.

(Reporting by Justin Grant; Editing by David Holmes)