Barrick Gold Corporation – Page 43

Barrick chair Peter Munk blasts Newmont’s company culture as miners struggle to reach deal – by Peter Koven (National Post – April 25, 2014)

April 25, 2014

The National Post is Canada’s second largest national paper.

TORONTO – Barrick Gold Corp. chairman Peter Munk levelled a pointed criticism of Newmont Mining Corp. on Thursday, saying he has struggled to strike a merger with his U.S. rival because the company is extremely bureaucratic and not shareholder-friendly.

Mr. Munk, 86, hoped to reach a deal to buy Newmont before he officially retires at Barrick’s annual meeting next month. But Toronto-based Barrick has been frustrated over years of negotiations by what he calls “cultural differences.”

He said that Newmont is an extremely conservative and risk-averse company, which makes negotiations very difficult. As one example, he pointed out that Newmont shut reporters out of its annual meeting this week after news of the talks leaked. He said Barrick would never consider doing that.

“That’s the cultural difference. That’s the kind of people they are, and that’s why it’s so difficult to make a deal,” he said in an interview. “They are not shareholder-friendly.” Even though they operate next to each other in Nevada, Barrick and Newmont are like oil and water.

Barrick Gold Corp shareholders file class action suit over Pascua-Lama mine – by Drew Hasselback (National Post – April 25, 2014)

April 25, 2014

The National Post is Canada’s second largest national paper.

Barrick Gold Corp. has been named in a proposed shareholders class action lawsuit that seeks $6-billion in damages because the company allegedly failed to make timely disclosure of problems at its Pascua-Lama mine in South America.

“Barrick misrepresented the progress and feasibility for development and production at the Pascua-Lama mine, repeatedly through the class period,” the plaintiffs allege in a notice of action filed Thursday in the Ontario Superior Court of Justice in Toronto.

Lawsuits in Ontario usually begin with the filing of a legal document called a statement of claim. Filing a notice of action officially launches the case, but also gives plaintiffs more time to follow up with more detailed allegations in the statement of claim.

The document filed Thursday contains allegations that have not been proven in court. “The company is aware that a notice of action has been filed in the Ontario Superior Court of Justice. Barrick disputes the allegations, and will defend itself against any lawsuit vigorously,” the company said in an emailed statement late Thursday.

Plaintiffs have filed similar securities class actions against Barrick over Pascua-Lama in the U.S. federal courts. The company has denied the allegations in the U.S. claims.

Peter Munk to leave Barrick Gold having seen its highs and lows – by James Wilson (Financial Times – April 24, 2014)

April 24, 2014

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Peter Munk started Barrick Gold with $40m of his own money in 1982, knowing not much about mining.

Now 86, and after more than 30 years in the gold business, Mr Munk still talks about Barrick having been the entrepreneurial “young upstart” for much of its life – but it became a company worth $50bn, a Canadian national champion built by a Hungarian-born refugee and the largest producer of gold in history.

Yet the past two years have been tough on Mr Munk, Barrick and the rest of the gold industry, particularly 2013, when Barrick posted $11.5bn of writedowns, cut its dividend and had to raise $3bn in equity to try to cut its debt.

“I would not have chosen this particular year as my final one as chairman, but I don’t get to write the script,” a chastened Mr Munk wrote in the company’s annual report. Barrick is now worth about $21bn.

Mr Munk also acknowledged the damage wrought by Barrick’s acquisition of Equinox Minerals in 2011. The unexpected diversification into copper came at an inflated price, for cash, and sparked doubts last year over Barrick’s debt levels and liquidity.

Barrick invites Newmont to restart merger talks – by Rachelle Younglai (Globe and Mail – April 24, 2014)

April 24, 2014

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Barrick Gold Corp. has formally asked Newmont Mining Corp. to resume merger talks after their negotiations hit an impasse late last week, according to a person familiar with the situation.

The North American-based gold miners had come close to agreeing on an all-stock deal, but their discussions broke down over which assets to spin out from the combined company, other sources have said.

The companies had aimed to make an announcement before their annual shareholder meetings this month. Colorado-based Newmont held its meeting in Delaware Wednesday morning, and Toronto-headquartered Barrick’s meeting is scheduled for April 30.

Barrick e-mailed the request to restart talks to Newmont, outlining the terms of their friendly proposal as well as issues that still must be resolved, according to the source familiar with what transpired.

Barrick’s Munk: Newmont Deal ’Always Made Sense’ (Bloomberg TV – April 23, 2014)

April 24, 2014

http://www.bloomberg.com/tv/ April 23 (Bloomberg) — Peter Munk, founder and chairman of Barrick Gold Corp., talks about a possible merger with Newmont Mining Corp., gold prices, and Barrick’s acquisition of Equinox Minerals Ltd. Munk speaks with Erik Schatzker on Bloomberg Television’s “Market Makers.” (Source: Bloomberg)

Ex-Goldman Banker Emerges as Barrick Gold Dealmaker – by Liezel Hill and Christopher Donville (Bloomberg News – April 22, 2014)

April 23, 2014

http://www.bloomberg.com/

A week before Barrick Gold Corp. (ABX) Chairman Peter Munk retires, his successor John Thornton is emerging as a dealmaker as the former Goldman Sachs Group Inc. banker pursues a bid to combine the two biggest gold miners.

Negotiations between Barrick and Newmont Mining Corp. broke off last week amid minor disagreements while leaving open the possibility that discussions could still resume, two people with knowledge of the matter said April 19.

The deal under discussion would have seen Thornton become executive chairman of the combined company while the chief executive officer would have been Gary Goldberg, who currently leads Newmont, the people said. Toronto-based Barrick’s CEO Jamie Sokalsky would have led a smaller gold producer spun off from the merged company, according to the people.

The proposed tie-up and its management reshuffle confirm Thronton’s elevation as Barrick’s most senior executive. The 60-year-old, who had no role in the mining industry until he joined the company’s board just over two years ago, is set to succeed Munk, Barrick’s 86-year-old founder, as chairman at the annual shareholders meeting next week. Leading a successful acquisition of Newmont (NEM), in what would be the biggest gold takeover, would set up Barrick to do further deals, including ones involving other commodities.

[Barrick’s] Munk touts ‘significant synergies’ in potential Newmont deal – by Rachelle Younglai (Globe and Mail – April 23, 2014)

April 23, 2014

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Barrick Gold Corp.’s founder and chairman Peter Munk said merging with rival Newmont Mining Corp. could result in “significant” cost savings, especially in Nevada where the two North American gold miners operate.

The world’s two largest gold producers had hoped to announce an all-stock merger deal before Newmont’s annual shareholder meeting in Delaware on Wednesday, but disagreed over which assets to spin off, sources have said. Although talks were halted late last week, the companies are still open to merging in an effort to cut costs amid the deep slump in gold prices, sources have said.

“Combining Barrick and Newmont could result in significant synergies and cost savings, particularly in Nevada, where our operations are literally next door to one another,” Mr. Munk said in an e-mailed statement.

Gold has lost more than a third of its value since peaking above $1,900 (U.S.) an ounce three years ago. The weaker precious metal price, now trading below $1,300 an ounce, has forced the gold industry to overhaul operations to preserve cash.

Barrick Gold-Newmont Mining ripe for merger as conditions favour tie-up of world’s gold giants – by Peter Koven (National Post – April 22, 2014)

April 22, 2014

The National Post is Canada’s second largest national paper.

Barrick Gold Corp. and Newmont Mining Corp. have held merger talks numerous times in the past without getting a deal done. But conditions finally appear right to bring together the world’s two largest gold producers.

A rough gold market, along with new personalities on both sides of the negotiating table, have helped the two companies overcome their longstanding differences and put them on the cusp of a deal that analysts and investors have eagerly awaited for years.

Recent merger talks between the two sides broke down over a disagreement on what assets to put into a spin-off company, according to sources. However, the broad terms of the merger were largely agreed upon, with Toronto-based Barrick planning to buy Denver-based Newmont for close to US$13-billion in stock, representing a small 13% premium over its recent trading range.

The two gold miners hoped to announce the deal ahead of Newmont’s annual meeting on Wednesday, but that now appears unlikely. Newmont shares rose 6.4% on Monday. Barrick shares opened higher, but then declined as gold dropped and investors absorbed the merger news. They ended the day down 4%.

Barrick must check its hubris to achieve a smooth Newmont merger – by Boyd Erman (Globe and Mail – March 22, 2014)

April 22, 2014

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Barrick Gold Corp. says its strategy is no longer about bigger, but about better. A successful merger with Newmont Mining Corp. has got to be about a bit of both.

Barrick is not talking yet, as no deal is done, but job one when a transaction is finalized will be to explain just how a combination with Newmont would square with Barrick’s new strategy.

Toronto-based Barrick has long sought to gain control of Newmont. Talks have gone on and off for more than decade as Barrick grew to become the world’s largest gold producer.

Newmont plus Barrick would create by a huge margin the world’s largest gold miner. There was a time when that would have been sufficient rationale for Barrick, but that is no longer good enough. Shareholders want returns and cash flow from their mines. They want profit from mining companies, not just growth.

Merger Talks Between Gold Giants Break Down – by Gillian Tan, Alistair MacDonald and Dana Mattioli (Wall Street Journal – April 18, 2014)

April 22, 2014

http://online.wsj.com/home-page

Barrick Gold, Newmont Mining Were Said to Be in Advanced Discussions

Barrick Gold Corp. ABX.T -1.88% and Newmont Mining Corp. NEM -0.88% recently held abortive talks over a deal that would have combined the world’s two largest gold producers at a time when they are battling a sharp drop in the price of gold, according to people familiar with the matter.

The two companies had intended to announce a deal as early as Tuesday, one of the people said. They have discussed combining a number of times before, people familiar with the matter have said, and it is possible they could do so again.

The deal talks come as the companies try to adapt to lower gold prices. The precious metal’s futures fell 28% last year—their biggest annual price drop since 1981.

Prices have fallen amid moves by the Fed to wind down its efforts to stimulate the economy. The stimulus steps had been a source of support for gold, which is used by investors as a hedge against the inflation that such efforts can spark.

Excerpt from Boardroom Games: You’re Fired! – Mining Boards: Local and Foreign Adventures – by Peter Crossgrove

April 8, 2014

To order a copy of From Boardroom Games: You’re Fired, click here: http://amzn.to/1pA7i7q or here: http://bit.ly/OYexer

For a three part BNN interview with Peter Crossgrove, click here:

http://watch.bnn.ca/#clip1071973

http://watch.bnn.ca/#clip1071974

http://watch.bnn.ca/#clip1071978

Excerpt from “Boardroom Games: You’re Fired!” – Mining Boards: Local and Foreign Adventures

Sudbury-born Peter A. Crossgrove and another partner invested in Interior Door, a private company that became Masonite, a public company sold to KKR for $3.2 billion in 2004. Peter’s mining and boardroom experiences are indelibly etched real-life scenarios—humorous and thought provoking. Having served on close to seventy mining, corporate, and not-for-profit boards, armed with a sense of humour, dignity, dogged determination, and humility, Peter has challenged boardroom antics and relationship intricacies with the skill-sets and values he was raised with.

Early Barrick Days

In the early Barrick days, Barrick Gold was originally called American Barrick so it would be listed higher in the newspaper stock pages and easier to find by investors. The original company was United Sysco and the CEO was Bob Fasken. Bob’s COO was Bob Smith. I knew them both well. I used to fly up with them in the company’s Turbo Beaver to Griffith Island, an island off Wiarton in Georgian Bay, to shoot pheasant and chucker partridge. We were members of the Griffith Island Club in Georgian Bay.

Editorial: Barrick rejigs exec pay – by John Cumming (Northern Miner – April 2, 2014)

April 3, 2014

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry. Editor John Cumming MSc (Geol) is one of the country’s most well respected mining journalists. jcumming@northernminer.com

Businessman and Bay Street veteran Peter Crossgrove, the one-time Placer Dome CEO and long-time Barrick Gold director, published his memoirs last year, and it makes for some lively and insightful reading, especially in light of Barrick’s newly revamped executive compensation program.

In his book titled “Boardroom games: You’re fired! When core values, respect and meaningful business practices are compromised for money and prestige,” Crossgrove is blunt in his criticism of the Barrick board, from which he was booted a couple of years ago to make way for Goldman Sachs’ John Thornton, who will become full Barrick chairman at the April 30 annual meeting, as founder Peter Munk retires.

“What do I think Barrick has to do to recover?” writes Crossgrove in 2013. “First of all, I would say they should find at least three directors who know the operating side of the business and form a technical committee . . . I suggest the chair, vice-chair and board members’ salaries be cut by 70%. They should only allow the chief operating officer the use of the corporate jet and get rid of the advisory board, which is a large expense and should be deleted . . . in 22 years I can only recall one meeting with the advisory board, whom I believe meet one day a year and are paid $100,000 per year.”

Barrick Gold slashed chairman’s pay to US$9.5M last year after investor outrage – by John Shmuel (National Post – April 1, 2014)

April 1, 2014

The National Post is Canada’s second largest national paper.

TORONTO — Barrick Gold Corp. unveiled a new compensation package for executives Monday, a year after management faced heavy blowback for a generous signing bonus that made incoming chairman John Thornton one of the highest paid executives in Canada.

The world’s largest gold miner said it had scaled back Mr. Thornton’s pay for 2013 to US$9.5-million, compared with US$17-million the prior year. Mr. Thornton’s original pay package, which included a US$11.9-million signing bonus, caused a rare rejection last year by shareholders of the company’s executive compensation plan.

“We heard shareholders loud and clear,” said Brett Harvey, Barrick’s lead director, adding that he saw the new compensation model as one that others in the industry are “going to follow.”

The new “scorecard” system will see Barrick pay a large chunk of compensation in stock that executives will have to hold until they retire or leave the company. It will also base salary on a number of performance metrics, including delivering planned cash flow, achieving cost targets and meeting earnings expectations. As chairman, Mr. Thornton will not fall under the new scheme.

Barrick to revise executive compensation rules – by Rachelle Younglai (Globe and Mail – March 31, 2014)

March 31, 2014

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Barrick Gold Corp. will unveil pay packages for outgoing chairman Peter Munk and his successor John Thornton, as well as new executive compensation methods, after shareholder uproar over the incoming chair’s signing bonus.

Mr. Thornton’s $11.9-million (U.S.) bonus galvanized the traditionally passive Canadian pension funds to demand changes to how Barrick was governed, triggering the company to overhaul its board of directors late last year.

Barrick’s management proxy circular, to be filed on Monday, will present a new compensation scheme designed to align management’s pay even more closely with the miner’s performance. The company’s plan is expected to require executives to hold their shares until they leave the company.

That would be a departure from the previous arrangements, which allowed management to exercise their stock options at certain dates. “This is coming after they paid Thornton his big bonus. In some respects it’s like shutting the barn door after the horses have left,” said Robert Gill, vice-president and portfolio manager at Lincluden Investment Management, which holds $3.3-billion in assets including Barrick.