https://business.financialpost.com/
Barrick Gold Corp.’s sudden expansionist desires are driven by the same concerns as the rest of the industry — it’s getting harder to find gold and more expensive to mine it, according to John McCluskey chief executive of Alamos Gold Inc.
Barrick is pursuing a $17.8-billion hostile bid for its arch rival, Newmont Mining Corp., in a deal that would combine the two largest gold companies into a firm of unparalleled size.
If successful, it would have numerous consequences for the rest of the gold industry, potentially laying the groundwork for future asset sales and consolidation, and also potentially pulling new generalist investors into the high-risk, high-reward precious metals sector.
McCluskey said he thinks Barrick, and its new chief executive Mark Bristow, is concerned about the company’s gold reserves — meaning the amount of yellow metal left at its mines — and wants to increase its size so that it can comfortably sell off less-impressive mines without cutting down its profitability.
“They’re trying to essentially get enough critical mass so they can afford to divest what they know in their portfolio are non-core assets,” said McCluskey.
For the rest of this article: https://business.financialpost.com/commodities/mining/why-barrick-wants-to-merge-with-newmont-gold-is-harder-to-find-and-mining-it-is-more-expensive