Acacia accept increased takeover bid from Barrick
Acacia Mining has agreed to sell its remaining shares to Barrick Gold Corp in a deal that values the firm at £951m and has sent its share price soaring by 18 per cent.
It comes after a two-month stand-off between the world’s second largest gold miner and its African unit, Acacia, which was formed into a separate company in 2010.
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Barrick already owns around 64 per cent of the shares in Acacia, but has now agreed a deal to buy out its remaining shareholders and retake complete control.
The deal will see Acacia’s shareholders receive a 0.168 share in Barrick, implying a value of 232p per share.
Barrick’s offer is up on the previous 193p per share bid and negotiations have taken two months to conclude since it tried to buy the shares it did not already own.
The Canadian miner’s final offer was 24.3 per cent more than Acacia’s share price was worth at the end of Thursday’s session.
However, last week shareholder Odey Asset Management suggested it would reject any bid for Acacia below 271p per share.
In a letter to Acacia seen by the Financial Times, Odey, which owns around a two per cent share in the firm, said: “We cannot see any logical reason to be willing to sell a security without marking it to market, and in this case that means marking it to $1,400 a troy ounce.”
Acacia previously criticised the low offer as undervaluing its mine plans and ignoring the value of its exploration and development assets, resulting in the deadline for a decision being extended on two separate occasions.
The takeover proposal comes after two years of disputing a $190bn (£153bn) tax bill in Tanzania between Acacia and the government, which was ultimately reduced to $300m in 2017.
The government, led by President John Magufuli, had claimed the London-listed gold miner owes it $190bn in back taxes and gave Acacia a ban on exporting a gold-bearing ore from a mine in the country.
An international arbitration brought by the miner was set to start in the latter half of this month.
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Barrick has claimed to have reached a deal with Magufuli which can only be signed if Acacia gets new owners.
The proposal is reported to have drawn the ire of Acacia’s minority shareholders, who may have the ultimate vote on a deal.