Hedge funds slash bullish wagers on gold over Trump election win
Hedge funds and other large speculators boosted net-long positions by 11% to 197,362 as of Nov. 12, the lowest in 14 weeks.
Canada’s Barrick Gold (TSX:ABX)(NYSE:GOLD) has been allowed by the High Court of Justice of England and Wales to acquire all outstanding issued shares it doesn’t already own in Acacia Mining (LON:ACA), which gives the gold giant full control of the African miner.
Acacia directors Peter Geleta, Rachel English, Steve Lucas Deborah Gudgeon Alan Ashworth and Adrian Reynolds will resign from the board.
Graham Shuttleworth and Martin Welsh have joined the board as directors, Barrick said.
The UK’s court approval removes the last hurdle to the conclusion of Barrick’s takeover bid.
The deal also ends Acacia’s near-decade presence on the London Stock Exchange. The Tanzanian miner’s shares, which have lost more than 50% of their value since first traded nine years ago, will be delisted, effective September 18.
Barrick’s original offer, submitted in May, valued Acacia at only $787 million. In July, the gold giant bowed to pressure from the African gold miner’s shareholders and submitted a sweetened $1.2 billion-offer.
The acquisition ends Acacia’s near-decade presence on the London Stock Exchange. Shares will be delisted with effect from Sept. 18
Including the special dividends, which depend on asset sales, the fresh offer represented a 60% premium to Acacia’s share price at the time of the indicative takeover pitch.
As Acacia’s majority shareholder, with a 63.9% stake, Barrick led discussions over alleged unpaid taxes with the Tanzanian government, which has refused to deal directly with the local miner.
The parties reached a framework deal in February, which would see Acacia paying $300 million to settle the tax claims and splitting returns from its operations 50/50 with the country going forward.
Acacia, which spun off from Barrick in 2010, complained about being left out of the negotiations, but Barrick’s chief executive, Mark Bristow, said it was the only way forward.
“It’s a tragedy,” he said in June. “We’re dealing with a complete breakdown of relationships.”
Acacia was ordered in July to stop using the tailings storage dam at its North Mara mine due to seepage from the facility.
Three of the company’s employees remain in jail in Tanzania awaiting charges for alleged corruption.
Barrick, the world’s No. 2 gold miner, is forging ahead with plans to sell about $1.5 billion in assets by the end of 2020. At the same time, it’s looking to buy more top-tier gold projects, in Canada and elsewhere, and invest in copper assets.
