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Barrick Says It Has 'Reviewed' Potential Merger With Newmont

Kitco News

(Kitco News) - Barrick Gold Corp. (NYSE: GOLD; TSX: ABX) confirmed Friday that it has “reviewed” a potential merger with Newmont Mining Corp. (NYSE: NEM) but said no decision has been made.

Barrick issued a two-sentence announcement after a news report in Canada’s Globe and Mail newspaper saying that Barrick is eyeing a hostile bid to take over Newmont.

The Globe and Mail reported that that under potential terms of the deal, Barrick would keep Newmont’s Nevada and African mines, while Australia’s Newcrest Mining would take over the Australian operations. The report said the deal valued Newmont at around $19 billion.

Barrick issued the following statement:

“Barrick Gold Corporation today confirmed that the company has reviewed the opportunity to merge with Newmont Mining Corporation in an all-share nil premium transaction. No decision has been taken at this time.”

Newmont officials were not immediately available for comment.

The report comes on the heels of a number of other major mergers in recent months, starting with Barrick’s autumn announcement that it would acquire Randgold Resources Ltd. The merger went into effect at the start of the year. Since, Newmont has announced plans to buy Goldcorp Inc. (TSX: G, NYSE: GG), and Pan American Silver Corp. (Nasdaq, TSX: PAAS) is merging with Tahoe Resources Inc. to create the world’s largest publicly traded silver-mining company.

The Barrick-Newmont news comes one day after Newmont released a quarterly earnings report that was stronger than analysts’ expectations. Newmont posted a fourth-quarter adjusted profit of $214 million, or 40 cents per share. News reports said analysts were looking for 25 cents a share.

For 2019, Newmont projected gold production of 5.2 million ounces and AISC at $935 per ounce. Barrick has 2019 production guidance of between 5.1 million and 5.6 million ounces of gold with AISC between $870 and $920 an ounce.

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