Acacia shareholders rebuke parent firm Barrick’s $285 million takeover offer

Acacia Mining’s minority shareholders have expressed disapproval of Barrick Gold’s US$285 million offer to take full control of the company, as the Canadian giant aims to resolve a long-standing tax dispute in Tanzania.

Barrick currently owns 63.9% of Acacia, and its all-share offer values the company at $787 million, a near 11% discount to its Tuesday close and 42% below Barrick’s own audited $1.3 billion valuation of Acacia’s assets in its 2018 annual report.

An anonymous Acacia shareholder told Reuters: “Either their auditors are not doing their job properly and they should have taken an impairment at the 2018 year end, or this is a false statement. Which is it?”

Barrick’s offer comes after two years of negotiations with the Tanzanian government on Acacia’s behalf, regarding a $190 billion tax bill for alleged misreporting of Acacia’s revenue going back to 2002. The sum has since been reduced to $300 million.

However, relations between Barrick and its subsidiary have deteriorated since Acacia blamed Barrick for being shut out of the talks, while Barrick has accused Acacia of failing to cooperate with its efforts.

Analysts at Peel Hunt said Acacia’s shareholders are unlikely to accept Barrick’s bid.