Tectonic Metals gets funding for gold exploration in Alaska
The company's Flat gold project is located 40 km north of the giant Donlin gold project.
Acacia Mining (LON:ACA) has hit back at its majority shareholder, Barrick Gold (TSX:ABX)(NYSE:GOLD), promising a detailed response to claims that its mine plans in Tanzania are not appropriately risked or supportable.
“The company strongly disagrees with a number of statements made in the announcement,” said Acacia, urging its shareholders to take no action.
It also said it was “surprised” with the circumstances and timing of the comments, which immediately followed earlier announcements regarding Acacia’s agreement to Barrick’s request for an extension to the bidding deadline.
Barrick, which owns about 64% of Acacia, made an informal proposal in May to buy out Acacia’s minority shareholders with its own shares, at a ratio that implied a discount to the unit’s market value. But the $285 million offer was considered by the African miner’s investors and some analysts as low.
The Canadian gold giant originally had until Tuesday to come up with a formal, perhaps better bid, but UK regulators granted the company a further three weeks.
Barrick’s chief executive Mark Bristow confirmed on Wednesday the company has called on minority shareholders to back the company’s all-paper offer for Acacia Mining, warning of a “catastrophic” loss of value if they oppose the deal.
He went on to openly question Acacia’s assumptions for resuming operations at its flagship Bulyanhulu mine, saying Barrick was more cautious on grade, annual mining volumes and production rates.
Acacia, Tanzania’s No.1 gold producer, has been embroiled in a battle with the East African nation since 2017, when the government banned exports of unprocessed metal and slapped it with a $190 billion tax bill — equal to almost two centuries worth of revenue.
The company, which spun off from Barrick in 2010, was also forced to cut output by a third from two of its three mines in the country — Bulyanhulu and Buzwag.
Since then, the relationship between Barrick and Acacia has been strained and progress moving an agreement forward has been “almost impossible,” chief executive Mark Bristow acknowledged last month.
The executive has also said Barrick has no intention of raising its offer to buy out the rest of troubled African unit, adding that Tanzania is not prepared to enter into a settlement directly with Acacia.
Barrick, however, said on Wednesday that Bristow’s comments should not be considered a “no-increase statement.”
Bristow believes his proposed buyout is the most “appropriate” and “elegant” solution to the long-running row over outstanding tax claims that has hit Acacia’s bottom-line.
