Brixton Metals teams up with Eldorado on Atlin Goldfields project
Located 9 km east of the town of Atlin, BC, the property comprises a 579-square-kilometre claim group.
Canada’s Barrick Gold (TSX:ABX)(NYSE:GOLD) has officially dropped its hostile takeover offer for U.S. rival Newmont Mining (NYSE:NEM) in favour of a friendly deal to create a joint-venture that will combine the two companies’ assets in Nevada.
The world’s two biggest gold miners have operated independently in Nevada for decades, but had been unable to reach an agreement on a way to co-operate until now.
“We listened to our shareholders and agreed with them that this was the best way to realize the enormous potential of the Nevada goldfields’ unequalled mineral endowment, and to maximize the returns from our operations there,” Barrick chief executive Mark Bristow said in statement.
Under the deal, Barrick will take a 61.5% stake in the JV with Newmont holding the remainder. Board representation will be based on ownership, while advisory committees will have equal representation, the companies said.
The “historic” business combination (as the duo called it) is expected to generate savings of $500 million a year within the first five years.
The “historic” business combination (as the duo called it) is expected to generate savings of $500 million a year within the first full five years. It includes Barrick’s Goldstrike, Cortez, Turquoise Ridge, and Goldrush and Newmont’s Carlin, Twin Creeks, Phoenix, Long Canyon, along with associated processing plants and infrastructure of both companies.
Excluded from the joint-venture, for now, are Barrick’s Fourmile project and Newmont’s Fiberline and Mike deposits. It also does not include Newmont’s Cripple Creek & Victor mine.
The agreement follows Newmont’s rejection of Barrick’s $18 billion hostile bid last week, countering with a proposal for a JV with a 55% interest for Barrick.
Newmont’s contra-offer wasn’t immediately welcome by the Toronto-based miner, which wanted a higher percentage and control of the venture.
After exchanging quite a few mutual verbal offences, the chief executives of the long-time rival miners reached a consensus over dinner in New York last week.
“We are finally taking down the fences to operate Nevada as a single entity in order to deliver full value to both sets of shareholders, as well as to all our stakeholders in the state, by securing the long-term future of gold mining in Nevada,” Bristow said.
“This agreement represents an innovative and effective way to generate long-term value from our joint assets in Nevada,” Newmont chief executive Gary Goldberg added.
The deal is subject to conditions, including regulatory approvals, and is expected to be completed in the coming months.
2 Comments
Karin Hall
Listening to shareholders, what a novel idea.
Alain Belanger
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