Newmont Says Rival Miner Barrick Gold Has Bought a Small Stake
Barrick proposes to make it easier for Newmont stock owners to call a
meeting, a move that comes ahead of a potential hostile bid
The Merian gold mine, owned and operated by the Newmont Suriname mining company in Suriname in 2016. https://www.wsj.com/articles/newmont-says-rival-miner-barrick-gold-has-bought-a-small-stake-11551050912
The Merian gold mine, owned and operated by the Newmont Suriname mining company in Suriname in 2016. PHOTO: RANU ABHELAKH/REUTERS
By Alistair MacDonald
Updated Feb. 24, 2019 7:33 p.m. ET
Newmont Mining Corp. NEM 3.02% said Sunday that rival miner Barrick Gold Corp. GOLD -2.10% has taken a small stake in the company and proposed to make it easier for Newmont stock owners to call a shareholder meeting, a move that comes ahead of a potential hostile bid by the Canadian company.
A spokesman for Denver-based Newmont said Barrick had bought 1,000 shares in the company, which has 535 million shares outstanding.
Barrick, with a market value of almost $23 billion, said Friday it is considering an all-stock, no-premium transaction to merge with Newmont, which is valued at about $19 billion.
Buying a small stake allowed Barrick to make two shareholder proposals for consideration at Newmont’s next annual shareholders meeting.
One proposal would be to amend Newmont’s bylaws to lower the share-ownership threshold necessary to requisition shareholder meetings to 15% from the current 25%, Newmont said.
Barrick also proposed to repeal all bylaw amendments implemented since Oct. 24, 2018. Newmont said there have been no bylaw amendments since then.
Though uncommon, Barrick’s move has the potential to turn into a possible proxy fight for control of Newmont’s board to force a deal. By seeking to make it easier for shareholders to force Newmont to call a shareholder vote, Barrick is laying the groundwork to put forth a slate of directors who might be more amenable to a merger if Barrick pursues a tie-up and Newmont’s current management and board oppose the idea.
A spokesman for Barrick declined to comment.
Newmont agreed earlier this year to buy miner Goldcorp Inc. of Vancouver, Canada, in a stock deal valued at $10 billion.
The pending deal would make Newmont the biggest gold miner by production, passing longtime rival Barrick, whose output has been declining.
The Newmont spokesman said the Goldcorp tie-up “will create an unmatched portfolio of world-class operations, projects, reserves, exploration opportunities and talent.”
He said the company won’t speculate on Barrick’s motivation for announcing it is considering making a hostile bid. Newmont said it hasn’t yet received an approach from Barrick.
Goldcorp shareholders are set to vote on Newmont’s offer April 4.
Barrick has long considered merging with Newmont to pair up their large gold-mining operations in Nevada and create an industry giant that would dwarf its nearest competitor. The last serious attempt at a deal faltered in 2014.
—Ben Dummett contributed to this article.
Write to Alistair MacDonald at email@example.com
Appeared in the February 25, 2019, print edition as 'Newmont Rival Buys Stake.' https://www.wsj.com/articles/newmont-says-rival-miner-barrick-gold-has-bought-a-small-stake-11551050912