Canada鈥檚 Barrick Gold (TSX:ABX)(NYSE:GOLD) has bowed to pressure from Acacia Mining鈥檚 (LON:ACA) minority shareholders, offering on Friday for the African miner that would give Barrick full control.
The offer would end a two-month standoff between the world鈥檚 second biggest gold miner and its Tanzanian unit, which聽spun off from Barrick in 2010.听
The improved proposal, already , values Tanzania鈥檚 No.1 gold producer at $1.2 billion (951 million pounds). The original one, submitted in late May, was rejected by the target shareholders who said it undervalued the company鈥檚 mine plans and disregarded the value of its exploration and development assets.
The improved proposal, already聽backed by Acacia鈥檚 board, values Tanzania鈥檚 No.1 gold producer at $1.2 billion (951 million pounds)聽
Barrick is now offering 0.168 of its own shares for every Acacia share, worth about 232 pence a unit. In addition, minority shareholders in the smaller gold producer could get special dividends on Acacia exploration properties, which would add another 9 pence per share, making it a total of 241 pence.
Including the special dividends, which depend on asset sales, the fresh offer represents a 60% premium to Acacia鈥檚 share price at the time of聽the indicative takeover pitch.
As Acadia鈥檚 majority shareholder, Barrick has been leading discussions over alleged unpaid taxes with the Tanzanian government, which has refused to deal directly with the local miner.
The parties reached a聽, which would see Acacia paying $300 million to settle the tax claims and splitting returns from its operations 50/50 with the country going forward.
Acacia complained about being left out of the negotiations, but Barrick鈥檚 chief executive, Mark Bristow, said it was the only way forward.
鈥淚t鈥檚 a tragedy,鈥� he said last month. 鈥淲e鈥檙e dealing with a complete breakdown of relationships.鈥�
Earlier this week, Acacia was ordered to stop using the tailings storage dam at its North Mara mine due to seepage from the facility.
Three of the company鈥檚 employees remain in jail in Tanzania awaiting charges for alleged corruption.
Today鈥檚 deal is expected to close in the fourth quarter.