Barrick Gold Corp. has reached an agreement with the Tanzanian government on a $300 million payment, a milestone toward resolving a dispute that has crippled the miner’s subsidiary in the African country, according to people familiar with the situation.
Executives from the Toronto-based producer and Randgold Resources Ltd., which is being bought by Barrick, met with Tanzanian negotiators on Dec. 7, said the people, who declined to be identified as the talks are private. During that meeting, the two sides made significant progress on a deal that includes Acacia Mining Plc paying $300 million in installments. The terms are now being handed off to a tax working group in Tanzania for review, the people said.
Once that group is satisfied with the numbers, the deal would have to be reviewed by Acacia’s board and the U.K. listing authority, and then voted on by shareholders, which could delay a resolution. Tanzania’s president, John Magufuli, would also need to review the findings of the group to be certain it’s in the best interests of the country, one of the people said.
Barrick, Acacia and Randgold declined to comment, as did Idris Kikula, chairman of the state-run Tanzania Mining Commission. Acacia shares jumped as much as 6.5 per cent in London, before closing up 5.4 per cent at 198.9 pence, the highest since January. Barrick was up 2.1 per cent as of 11:53 a.m. in Toronto.
In 2017, Tanzania banned exports of unprocessed metal and slapped Acacia with a US$190 billion tax bill equal to almost two centuries of revenue, leading to a collapse in the stock.
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