Barrick Gold, Shandong Announce Investment Agreement
(Kitco News) - Barrick Gold Corp. (NYSE, TSX: ABX) has entered into a mutual investment agreement with Shandong Gold Group Co., Ltd. to further strengthen ties between the two companies after the two firms announced a strategic cooperation agreement this summer, officials reported Monday.
Under the latest announcement, Shandong Gold will purchase up to $300 million of Barrick shares, and Barrick will invest an equivalent amount in shares of Shandong Gold Mining Co., Ltd., a publicly listed company controlled by Shandong Gold.
The announcement was the second major one made by Barrick on Monday as the Denver Gold Forum gets under way. Often major announcements occur in conjunction with the gathering of gold-industry participants. Earlier Monday, Barrick said it was merging with Randgold Resources Ltd. (Nasdaq: GOLD) to create the largest gold producer in the world.
“Barrick and Shandong both believe that by working in partnership, we can leverage our collective strengths to unlock long-term value for our respective shareholders, just as we are at Veladero today, with the potential to expand to Lama and other El Indio Belt projects in the future,” says Barrick Executive Chairman John L. Thornton.
Barrick and Shandong Gold are 50-50 joint venture partners at the Veladero mine in Argentina. Also, Shandong Gold is currently carrying out an independent evaluation of Barrick’s Lama project, including an analysis of potential synergies between Lama and nearby Veladero. The two companies have also created internal working groups that are sharing technical expertise and best practices focused on best-in-class mining practices and innovation.