Barrick Chair John Thornton plots overhaul for post-Munk Era – by Peter Koven (National Post – December 5, 2013)

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John Thornton has laid out his vision for Barrick Gold Corp.: a more diversified mining company that can tackle big projects by accessing capital and partners in Asia. With his leadership, he thinks Barrick is in position to become a world-leading company, not just in gold but in “a range of minerals.”

“That’s where I’d like to see Barrick go,” he told reporters. His comments indicate that the world’s biggest gold producer could undergo a significant facelift in the years to come. Mr. Thornton even suggested that hedging, an extremely unpopular strategy among gold investors and one that previously backfired on Barrick, is something the company should be “carefully following at all times.”

Mr. Thornton was officially declared the Barrick’s next chairman on Wednesday after Peter Munk, 86, retires at next year’s annual meeting.

In a joint meeting with reporters, Mr. Munk talked about how he feels the world’s centre of gravity has shifted from West to East, and that Barrick needs a leader who can access capital and key business leaders in that country. Mr. Thornton headed up a Chinese business school for nearly a decade and has a wealth of Asian contacts.

Mr. Munk also mentioned the rising costs and challenges of bringing mines into production, and that forming Asian partnerships will allow Barrick to tackle projects that would otherwise be increasingly tough. It is understood that he has been seeking greater Asian influence at Barrick for a number of years.

As a believer in the long-term Asian growth story, Mr. Thornton believes it makes sense for Barrick to be producing a broader mix of commodities, including more copper. Some investors will bristle at this, particularly since Barrick’s last foray into copper (the acquisition of Equinox Minerals Ltd.) was a disaster.

But Mr. Thornton has met with many of the company’s key investors since becoming co-chairman last year, and he said they appear to be more relaxed about diversification now that gold companies have lost the premium stock price multiples they used to enjoy.

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