Barrick Mining, a leading global gold miner, is contemplating a London listing for its African operations. This move is part of a broader strategy to divest from regions deemed risky and focus on areas with stronger returns. The company is in early discussions about a potential all-share transaction with Endeavour Mining, a UK-listed company, according to sources familiar with the matter.
Strategic Shifts and Potential Mergers
The discussions, still in preliminary stages, involve creating a separate Africa-focused entity listed in London, while Barrick retains its Toronto listing as a holding company. This strategy echoes Barrick’s past actions when it spun off its African business as Acacia, which was later reacquired.
Endeavour Mining, backed by billionaire Naguib Sawiris, is seen as a strategic fit for Barrick’s African assets. The potential merger could create a combined entity valued at approximately $30 billion. However, no final decision has been made, and there is no certainty that a deal will materialize soon.
Focus on Risk Management
Barrick’s leadership, under Chairman John Thornton and CEO Mark Hill, is steering the company away from regions perceived as high-risk. This includes plans to sell mines in African countries and other areas where Barrick holds management but not majority control, such as Papua New Guinea.
The company recently resolved a prolonged dispute with Mali’s military-led government, which had previously led to the ousting of former CEO Mark Bristow. This settlement is part of Barrick’s broader efforts to stabilize operations and enhance investor confidence.
Endeavour’s Position
Endeavour Mining, having overcome past operational and governance challenges, is now positioned to consider larger deals. A merger with Barrick’s African assets could provide Endeavour with exposure to new regions like Tanzania and the Democratic Republic of Congo, though it may also reintroduce exposure to Mali, a region Endeavour previously exited.
While the potential merger is described as a merger of equals, it is expected to proceed with little or no premium, reflecting the strategic alignment of both companies’ interests.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
