Barrick Gold offers to buy Newmont Mining Corporation
Barrick Gold Corp. is going hostile in its bid to acquire Newmont Mining Corp. and create the world’s largest gold producer, offering US$17.8 billion for the company in an all-share deal. Shares of both companies fell.
“We did over the last several years take a look at either acquiring Barrick or Randgold and we just couldn’t see the value potential,” Goldberg said in a Bloomberg TV interview Monday. Asked whether his company would reconsider now — and if it would have the firepower to take a run at Barrick without a partner — he said, “I think at this stage all options are open and we’ll see where we go.”
Newmont fell 0.4 per cent US$36.345 at 1:22 p.m. in New York, after sliding as much as 2.9 per cent earlier. Barrick dropped 2 per cent to US$12.77, reversing a 0.6 per cent gain earlier. “It’s a desperate and bizarre attempt to muddle up our deal,”Goldberg said in an interview before Barrick’s announcement. “And it’s certainly not the sort of behavior that will appeal to investors who want to invest in serious, well-run companies.”
A key part of Barrick’s quest for Newmont are its adjoining assets in Nevada. The two companies have talked about how some sort of “unification” of their operations could benefit them. Barrick made clear it has no interest in the Goldcorp assets. “Paying a 17 per cent premium for Goldcorp. with the second-tier assets and no synergies, followed almost immediately by the departure of Newmont CEO, strikes me as both desperate and bizarre,” Bristow said.
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