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Barrick Gold Corporation

What lessons does Barrick Gold’s fate really teach us? – by Robert Yalden (Globe and Mail – January 7, 2018)

https://www.theglobeandmail.com/

Robert Yalden is the Stephen Sigurdson Professor in Corporate Law and Finance at Queen’s University and previously a senior partner at Osler, Hoskin & Harcourt LLP, where he served as co-chair of its M&A Group.

The year 2019 has barely begun, yet some have already started wringing their hands in public about the fate of corporate Canada. This time, the focus is a set of changes that are unfolding at Barrick Gold Corporation, a Canadian company that the legendary Peter Munk built into one of the world’s largest gold-mining businesses.

The changes include Barrick’s decision to acquire Randgold Resources Ltd., announced in September, 2018, and completed on Jan. 1, 2019, after receiving shareholder and regulatory approvals. The transaction forms part of Barrick’s plan to refocus its business and implement other related initiatives that have now suddenly caught people’s attention: revamping Barrick’s board of directors, so that instead of having several resident Canadian directors, it will have only one with Canadian roots; and reducing the number of positions in Barrick’s Toronto head office from the 150 or so that were there in September to approximately 65 to 70.

Pierre Lassonde, chair of the board of Franco-Nevada Corp., was quoted in The Globe and Mail on Jan. 4 as saying that he thought Mr. Munk, Barrick’s founder, “is going to roll over in his grave 10 times.”

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The gutting of Barrick Gold – it didn’t have to be this way – by Eric Reguly (Globe and Mail – January 5, 2019)

https://www.theglobeandmail.com/

Before I moved to Europe in 2007, I spent almost a decade in Toronto writing about the eradication of Corporate Canada. Most big companies I followed – Inco, Falconbridge, Alcan, Dofasco, Molson, Fairmont, Four Seasons, among others – were flogged to foreigners, their head offices downgraded to branch plants or eliminated.

Were it not for ownership restrictions, the banks also would have surrendered to the cult of shareholder value – take the premium and hit the links. Canadians were sellers, not builders. If there was one company that was safe from the takeover onslaught, it was Barrick Gold, I thought. I was both right and wrong, but more wrong.

At the time, Barrick was run by its founder, Peter Munk, the Hungarian-born Canadian patriot who wanted to build the world’s biggest gold miner. After achieving that goal, he mused about creating a diversified resources giant, the equivalent of a BHP Billiton or Rio Tinto under the Maple Leaf.

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Barrick Gold veering away from Canadian roots after Randgold acquisition – by Niall McGee and Rachelle Younglai (Globe and Mail – January 4, 2019)

https://www.theglobeandmail.com/

The slow shift of power away from Barrick Gold Corp.’s Canadian head office has moved into high gear, just days after it closed its deal with African operator Randgold Resources Ltd.

The US$6-billion acquisition, which was announced in September and completed Tuesday, has left Barrick with a hollowed-out head office, almost no Canadian representation on the board and few Canadians in top management positions.

Barrick’s retreat in Canada reflects a broader downsizing of Toronto as a world mining capital, with fewer global players headquartered in the city and dramatically less mining capital being raised on the Toronto Stock Exchange. Barrick, the world’s largest gold producer, had been one of the last great Canadian corporate mining champions left standing after a wave of foreign takeovers of metals giants such as Inco and Falconbridge.

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Barrick’s New CEO Says Gold Industry Shake-Up Is Just Starting – by Thomas Biesheuvel (Bloomberg News – January 2, 2019)

https://www.bloomberg.com/

Barrick Gold Corp.’s new chief executive officer has a message for the gold industry: This is just the start of a big shake-up.

Barrick agreed to buy smaller rival Randgold Resources Ltd. in a $5.4 billion deal announced in September. As part of the agreement, Randgold’s CEO, Mark Bristow, became the chief executive of Barrick, the world’s biggest gold miner.

“Without a doubt, this industry needs transformation,” Bristow said in an interview from New York, where the combined company started trading Wednesday. “We believe we have started that. We’re going to end up with a blue-chip business and on the way we’re not going to be sitting on our hands should there be other opportunities.”

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Barrick’s new CEO defends head-office job cuts as Randgold acquisition closes – by Niall McGee (Globe and Mail – January 3, 2019)

https://www.theglobeandmail.com/

Barrick Gold Corp.’s new chief executive officer defended the company’s decision to lay off more than half of the staff at its Toronto head office before Christmas, saying it was a necessary move in a difficult market.

Barrick issued layoff notices to about 95 people at its headquarters in December, bringing its headcount down to about 65 people, The Globe and Mail reported on Dec. 21. In an interview, CEO Mark Bristow said there are no plans to shut the office entirely, adding that a continuing staff is needed to carry out treasury services, human resources and accounting.

In another sign of Barrick’s diminished presence in the country, the gold miner announced a revamped board of directors on which only one of nine members is Canadian. Leaving the board are Anthony Munk, son of Barrick founder Peter Munk; Toronto-based mining consultant Graham Clow; and Robert Prichard, who is chair of Bank of Montreal.

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Barrick’s no-premium Randgold deal expected to spur more mining M&A in 2019 – by Niall McGee (Globe and Mail – January 1, 2019)

https://www.theglobeandmail.com/

Junior mining companies struggled once again to raise capital in 2018 with
the lowest level of equity issuance in the North American metals and mining
sector in 13 years. To fill the void, many have turned to more expensive
methods of raising capital, including royalty agreements and streaming deals.

Barrick Gold Corp.’s “no-premium” US$6-billion acquisition of Randgold Resources Ltd. is expected to trigger more deal making in the struggling Canadian gold sector in 2019.

During the great commodities boom of the mid-2000s, Barrick and others unveiled splashy multibillion-dollar-premium takeovers only eventually to take massive writedowns. But in September, Barrick broke away from the old model by announcing it will pay merely the market price for Randgold. The deal was warmly greeted by shareholders on both sides as a sensible solution in a difficult market.

“M&A has slowly been re-entering investor consciousness, and we suspect this trend will gain momentum in 2019, especially since there have now been a few successful transactions,” BMO Nesbitt Burns Inc. analyst Andrew Kaip wrote in a note to clients, including the Barrick-Randgold deal as an example.

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‘We definitely need more assets in Canada,’ Barrick’s new CEO says – by Nicole Gibillini(Bloomberg News – January 3, 2019)

 

https://www.bnnbloomberg.ca/

Barrick Gold Corp. () needs more assets in Canada, the gold miner’s new chief executive officer said Wednesday, on the company’s first day of trading since its recent acquisition of Randgold Resources Ltd.

“Barrick is back,” 59-year-old Mark Bristow told BNN Bloomberg in an interview from the New York Stock Exchange. “We should be proud of being team players in the Barrick family, and one of the things that I really am focused on is we definitely need more assets in Canada. ”

Barrick currently operates just one mine in the country – Hemlo Mines – east of Thunder Bay, Ont. “Don’t get too hung up right now on us only having Hemlo,” Bristow added. “We’re definitely focused on growing this business and you’re correct if you’re recognizing that we’re underweight in our investments in Canada.”

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[Barrick Gold Corp] A Goldman Alum, a Big-Game Hunter, and $100 Billion Business – by Danielle Bochove and Thomas Biesheuvel (Bloomberg News – December 18, 2018)

https://www.bloomberg.com/

John Thornton is a Goldman Sachs alumnus educated at Yale, Harvard and Oxford. Mark Bristow is a South African geologist and big-game hunter. Together, this corporate odd couple has a plan to turn around the lagging fortunes of the world’s largest gold-mining company, whose shares are down 67 percent from their high in 2010.

Thornton, executive chairman of Barrick Gold Corp., set the partnership in motion when he announced a deal for smaller rival Randgold Resources Ltd. for $5.4 billion in September. He tapped Bristow, Randgold’s chief executive officer, to be the CEO of the combined companies.

Thornton is getting a maverick, but also a CEO whose company’s share price has gained about 5,300 percent since the end of 1999, making it the best-performing stock in London’s FTSE 100 Index this century.

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Barrick Moves Closer to Resolving Acacia Dispute – by Danielle Bochove, Thomas Biesheuvel and Kenneth Karuri (Bloomberg News – December 12, 2018)

https://www.bloomberg.com/

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.

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[Neveda Barrick] Q+A: Mining executive shares industry insights gleaned over decades – by Yvonne Gonzalez (Las Vegas Sun – December 9, 2018)

https://lasvegassun.com/

In more than 25 years in the mining industry, Michael Brown says that as he retires, his proudest moment was bringing his company to Southern Nevada.

Brown joined Barrick Gold Corp. in 1994 as the vice president of government affairs and is retiring as president by the end of the year. He shared some of his thoughts on the industry and the future with the Sun. His comments have been lightly edited for grammar and style.

What do you think are some of the key ways your work at Barrick helped bring the mining industry and state government closer together?

Starting in 2012, I shifted Barrick from “random acts of good deeds” to focused corporate social responsibility. It meant aligning the company with Gov. Brian Sandoval and the Legislature’s priorities, to help address the high school dropout rate and to advance economic diversification.

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La Mancha plans to expand its African footprint, buy Barrick gold mines (Reuters U.K. – November 27, 2018)

https://uk.reuters.com/

LONDON (Reuters) – La Mancha Group plans to buy more underground gold mines in Africa and is ready to snap up mines that Barrick Gold (ABX.TO) and Randgold Resources (RRS.L) will sell after their merger, its billionaire chairman Naguib Sawiris said on Tuesday.

“(The Barrick disposals) might be in geographies where we are very strong and that makes sense for us,” Sawiris told reporters on the sidelines of the Mines and Money conference in London. “We can extend the mine lives.”

Sawiris said he was looking for mines with lives of at least 10 years and with output of 150,000 to 250,000 ounces per annum.

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New Barrick CEO eyes miners’ alliance to fix Tanzania tax row – by Zandi Shabalala and Susan Taylor (Bloomberg News – November 26, 2018)

https://www.reuters.com/

LONDON/TORONTO (Reuters) – Barrick Gold’s (ABX.TO) incoming chief executive said he wants to pull together Tanzania’s mining industry to tackle a “desperate” tax dispute that has snared several companies, including the firm’s Acacia Mining (ACAA.L) unit.

In an increasingly acrimonious conflict that has lasted almost two years, the government has torn up mining contracts, hiked taxes and royalties, and banned raw minerals exports.

President John Magufuli, nicknamed “The Bulldozer”, swept to power in 2015 pledging to secure a bigger share of resource wealth and cut corruption. Acacia was later handed a $190 billion tax bill – about four times the country’s gross domestic product – for underreporting output.

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Ex-SAS Officer Who Led Barrick’s Tanzania Talks Has Left – by Danielle Bochove (Bloomberg News – November 21, 2018)

https://www.bloomberg.com/

One of Barrick Gold Corp.’s most senior executives, who held various high-profile roles at the company from Nevada to Tanzania, has left the company as it prepares to complete its merger with Randgold Resources Ltd.

Richard Williams served as Barrick’s chief of staff and later chief operating officer. A former commander in Britain’s Special Air Service, he was assigned in February to work full-time on securing a deal between the Tanzanian government and Barrick’s majority-owned subsidiary Acacia Mining Plc.

“Willem Jacobs will be taking on those responsibilities following the completion of the merger, in his capacity as head of Africa and Middle East,” Barrick spokesman Andy Lloyd said by text. He declined to comment further other than to confirm that Williams has left Toronto-based Barrick.

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Barrick Gold eyes assets, exploration as it plots new phase – by Susan Taylor and Zandi Shabalala (Reuters/Yahoo – November 16, 2018)

https://ca.finance.yahoo.com/

TORONTO/LONDON (Reuters) – Barrick Gold Corp, soon to become the world’s largest bullion miner, is interested in adding more copper assets as long as the red metal is accompanied by bullion, executives said on Friday.

Barrick, which expects to complete its $6.1 billion takeover of Randgold Resources Jan. 1, outlined plans for exploration, expansion, streamlining and asset sales at an investor presentation in London.

Structured under regions in North America, South America and Africa and the Middle East, Barrick spent the last four days focusing on where to take the merged company, said Randgold Chief Executive Officer Mark Bristow, who will be Barrick’s new CEO.

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Barrick Gold in talks to sell Lagunas Norte mine in Peru – by Niall McGee (Globe and Mail – November 17, 2018)

https://www.theglobeandmail.com/

Barrick Gold Corp. is in talks to sell its Lagunas Norte gold mine in Peru with a sale announcement possible before the end of the year.

Mark Hill, chief operating officer, Latin America and Australia Pacific, with Barrick, made the comments about Lagunas on Friday during a webcast alongside executives from Randgold Resources Ltd., which Barrick is in the process of acquiring.

Earlier this year, Barrick’s executive chairman, John Thornton, said the Toronto-based gold miner intended to sell assets that weren’t strategic or tier-one and included Lagunas as an example. He defined tier-one as a property that produces at least half a million ounces of gold a year, has a life of more than 10 years and is low cost.

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