Barrick Gold Corp. is withdrawing its $17.8 billion hostile takeover bid for Newmont Mining Corp., with the companies opting instead to forge a joint venture around their Nevada projects.
The change came weeks after Barrick proposed an all-share offer that would have created the world’s largest gold producer. After Newmont’s board rejected the bid, Newmont Chief Executive Officer Gary Goldberg proposed the joint venture as an alternative both companies could gain from.
Barrick’s decision ends two weeks of animosity between the gold producers, and helps Newmont focus on securing shareholder approval for its previously announced offer to buy Goldcorp Inc. Newmont raised doubts about the Barrick bid from the start, saying its Goldcorp move offered better benefits.
“We listened to our shareholders and agreed with them that this was the best way to realize the enormous potential of the Nevada goldfields’ unequaled mineral endowment, and to maximize the returns from our operations there,” Barrick CEO Mark Bristow said in a statement Monday.
Newmont rose 17 cents to $33.88 in pre-market trading in New York. Barrick gained 2.4 percent to $13.24. Barrick and Newmont said in 2014 that there was plenty of hidden gold still to be uncovered in Nevada, which accounted for a third of their output then, and produced more of the metal than South Africa and Chile combined.
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