Barrick Completes Massawa Transaction
March 04 2020 - 4:55PM
In line with its strategy of focusing on Tier One assets, Barrick
Gold Corporation (NYSE:GOLD)(TSX:ABX) has completed the recently
announced transaction of combining its Massawa gold project in
Senegal with Teranga Gold Corporation’s Sabodala gold mine. Barrick
and its Senegalese partner held a 90% interest in the Massawa
project.
As part of the transaction, Barrick and its
partner will receive an up-front payment valued at $380 million at
the time of announcement, comprised of 20,718,273 Teranga common
shares (with a value at the time of announcement of approximately
$80 million based on the Teranga share price at that time of $3.85
per share), a cash payment of approximately $300 million, and a
contingent payment of up to $50 million which is based upon the
average gold price for the three-year period immediately following
closing (“three year average gold price”). The contingent payment,
which is payable three years following closing, is: $25 million if
the three year average gold price is greater than $1,450 and less
than $1,500 per ounce; $35 million if the three year average gold
price is greater than $1,500 and less than $1,600 per ounce; and
$50 million if the three year average gold price exceeds $1,600 per
ounce.
Barrick president and chief executive Mark
Bristow said Massawa was one of the largest unexploited gold
deposits in West Africa and its legacy company Randgold Resources
had developed this over a period of years to the point where its
value could now be optimally realized for the benefit of all its
stakeholders which includes the Senegal Government.
“Teranga is best placed to achieve this as it
already owns the nearby Sabodala mine and Sabodala’s combination
with Massawa is expected to deliver significant synergies. Barrick
will participate in the upside of the combined asset through the
11% interest it is acquiring in Teranga through this transaction,”
he said.
Enquiries:
Mark BristowPresident and CEO+1 647 205 7694+ 44
788 071 1386
Kevin ThomsonSenior executive vice-president,
strategic matters+1 416 307 5150
Kathy du PlessisInvestor and media relations+44
20 7557 7738Email: barrick@dpapr.com
Website: www.barrick.com
Cautionary Statement on Forward-Looking
Information
Certain information contained in this press
release, including any information as to Barrick’s strategy, plans,
or future financial or operating performance, constitutes
“forward-looking statements”. All statements, other than statements
of historical fact, are forward-looking statements. The word
“will”, and similar expressions identify forward-looking
statements. In particular, this press release contains
forward-looking statements including, without limitation, with
respect to: the anticipated benefits from the combination of the
Massawa project with Teranga’s existing assets and the creation of
a new West African gold mining company with significant African
ownership and the eventual payment of the contingent consideration
following the third anniversary of closing.
Forward-looking statements are necessarily based
upon a number of estimates and assumptions; including material
estimates and assumptions related to the factors set forth below
that, while considered reasonable by Barrick as at the date of this
press release in light of management’s experience and perception of
current conditions and expected developments, are inherently
subject to significant business, economic, and competitive
uncertainties and contingencies. Known and unknown factors could
cause actual results to differ materially from those projected in
the forward-looking statements, and undue reliance should not be
placed on such statements and information. Such factors include,
but are not limited to: fluctuations in the spot and forward price
of gold, copper, or certain other commodities (such as silver,
diesel fuel, natural gas, and electricity); the speculative nature
of mineral exploration and development; changes in national and
local government legislation, taxation, controls, or regulations
and/or changes in the administration of laws, policies, and
practices, expropriation or nationalization of property and
political or economic developments in Canada, the United States,
Jersey or Senegal; lack of certainty with respect to foreign legal
systems, corruption and other factors that are inconsistent with
the rule of law; risk of loss due to acts of war, terrorism,
sabotage and civil disturbances; timing of receipt of, or failure
to comply with, necessary permits and approvals, including
Barrick’s ability to successfully obtain the Massawa mine license
from the Government of Senegal; failure to comply with
environmental and health and safety laws and regulations;
litigation and legal and administrative proceedings; damage to
Barrick’s reputation due to the actual or perceived occurrence of
any number of events, including negative publicity with respect to
the Barrick’s handling of environmental matters or dealings with
community groups, whether true or not; contests over title to
properties, particularly title to undeveloped properties, or over
access to water, power and other required infrastructure; employee
relations including loss of key employees; risks associated with
working with partners in jointly controlled assets; risks relating
to Teranga’s ability to realize capital and operating synergies
with respect to the Sabodala gold mine and the Massawa project; and
availability and increased costs associated with mining inputs and
labor. In addition, there are risks and hazards associated with the
business of mineral exploration, development, and mining, including
environmental hazards, industrial accidents, unusual or unexpected
formations, pressures, cave-ins, flooding, and gold bullion, copper
cathode, or gold or copper concentrate losses (and the risk of
inadequate insurance, or inability to obtain insurance, to cover
these risks).
Many of these uncertainties and contingencies
can affect our actual results and could cause actual results to
differ materially from those expressed or implied in any
forward-looking statements made by, or on behalf of, us. Readers
are cautioned that forward-looking statements are not guarantees of
future performance. All of the forward-looking statements made in
this press release are qualified by these cautionary statements.
Specific reference is made to the most recent Form 40-F/Annual
Information Form on file with the SEC and Canadian provincial
securities regulatory authorities for a more detailed discussion of
some of the factors underlying forward-looking statements, and the
risks that may affect Barrick’s ability to achieve the expectations
set forth in the forward-looking statements contained in this press
release.
Barrick disclaims any intention or obligation to
update or revise any forward-looking statements whether as a result
of new information, future events or otherwise, except as required
by applicable law.
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