19 Jul Barrick Gold finally strikes deal to buy out Acacia Mining
Barrick Gold will buy out minority shareholders at its subsidiary Acacia Mining after agreeing a deal that values the firm at around $US1.2 billion, thus ending a bitter dispute between the two parties.
The world’s second largest gold miner made an informal offer in May to acquire the 36% stake in Acacia that it didn’t already own, however this was knocked back by Acacia’s minority shareholders who argued the $285 million bid significantly undervalued the shares.
While Barrick CEO Mark Bristow insisted that he wouldn’t raise his company’s bid, Acacia today announced, on the deadline for a formal offer set by the UK takeover panel, that Barrick had raised its bid to around $428 million for the remaining shares.
Acacia is fully satisfied with the final terms, said acting CEO Peter Geleta. “Given all the circumstances this is possibly the best outcome,” he said by phone to Bloomberg.
The takeover had been complicated by Acacia’s deteriorating position in Tanzania, after it was accused of decades of misreporting revenues by the Tanzanian government, who subsequently handed the firm an enormous $190 billion tax bill in 2017.
Barrick then took on the role of negotiating a settlement with the government on behalf of its subsidiary, which led Acacia to complain that it was locked out of negotiations with Tanzania.
However, both companies can now draw a line under the dispute, after agreeing a deal that will offer Acacia shareholders 0.168 Barrick Shares, as well as special dividends on Acacia exploration properties and deferred cash consideration dividends.