Strategic Partnership with Zijin Mining Group - Report on Barrick Gold

Jul 27, 2015, 09:10 ET from www.aciassociation.com

NEW YORK, July 27, 2015 /PRNewswire/ --

ACI Association has initiated research coverage on Barrick Gold Corporation (NASDAQ: ABX). Select highlights from the internally released reports are being made available to the general public (included below), with access to the entirety of the research available to new members.

Today, membership is open to readers on a complementary basis at the following URL: http://www.aciassociation.com/?c=ABX

Highlights from our ABX Report include:

  • Strategic Partnership - On May 26, 2015, Barrick Gold Corporation (Barrick) announced that it has formed a strategic partnership with Zijin Mining Group Co., Ltd, a leading Chinese mining company. The release informed that both companies have signed a long-term strategic cooperation agreement which outlines the intent of Barrick and Zijin to collaborate on future projects and joint investments, leveraging the strengths of each company.
  • Financial Aspects of the Partnership - The Company added that Zijin will buy a 50% stake in Barrick Niugini Limited (BNL), the company which owns 95% of the Porgera Joint Venture gold mine in Papua New Guinea, for $298 million.  The Company informed that under the new structure, Zijin and Barrick will jointly control BNL after the sale, which is expected to be completed in the third quarter of 2015. As per a release by Bloomberg dated May 27, 2015, Zijin Mining Group Co. will be acquiring mines in Papua New Guinea and the Democratic Republic of Congo, for $710 million. Bloomberg report noted that, Zijin has also agreed to acquire 49.5% of Ivanhoe Mines Ltd.'s Kamoa copper project in Democratic Republic of Congo (DRC) for $412 million.
  • Details of Agreement - Barrick informed that under the strategic cooperation agreement, both the Companies will explore long-term opportunities to collaborate on future projects. Furthermore, substantial synergies and value may be realized by bringing to Barrick the expertise and relationships that Zijin offers, including, leading Chinese engineering and construction skills, low-cost capital from Chinese institutions and Chinese machinery, equipment other critical suppliers that are in line with world-class standards of quality at competitive costs.

 

  • Management In-Charge of BNL - The Company informed that in the new structure, BNL will be jointly controlled by Barrick-Zijin Board of Directors which will consist of three nominees each of both the companies. As per the release, the current BNL management team will remain in place, with incumbent Executive General Manager, Greg Walker, who was nominated by Barrick as the first Executive Managing Director. Meanwhile, Zijin will nominate the first Chairman of the Board and Deputy Managing Director.

To find out how this influences our rating on Barrick Gold Corporation read the full report in its entirety here: http://www.aciassociation.com/?c=ABX

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