TSX-listed Barrick Gold Corporation has confirmed that the UK Takeover Panel has approved an extension of the deadline for its announcement of a firm intention to make a firm offer for the outstanding shares in Acacia from 18 June 2019 to 9 July 2019.
This extension will allow for the continuation of discussions with the independent directors and further engagement with Acacia’s shareholders concerning the proposal made to Acacia.
The proposal is subject to the satisfaction of a number of customary conditions, including receiving the recommendation of the Acacia board.
Barrick does however reserve the right to waive all or any of such conditions at its discretion. The proposal does not constitute an offer or impose any obligation on Barrick to make an offer.
Barrick has however noted that having reviewed the Acacia asset portfolio through a detailed due diligence, it believes its proposed offer price to acquire the outstanding shares in the company is fair value.
These statements are preceded by a meeting with Barrick and the directors and senior management of Acacia in which they presented a proposal to acquire all of the shares it does not already own in Acacia through a share for share exchange of 0.153 Barrick shares for each ordinary share of Acacia.
The exchange ratio is based on the 20-day volume weighted average trading prices of Acacia and Barrick as at market close in London and New York on 20 May 2019.
This implies a value for Acacia of US$787 million and total consideration to the minority shareholders of Acacia of $285 million.
Barrick has been negotiating with the Government of Tanzania (GoT) for the last two years to seek a basis for a settlement of Acacia’s ongoing disputes with the GoT and to establish a viable framework under which Acacia could resume its full operations in Tanzania and rebuild its relationships with the GoT.
Since the proposal is in Barrick shares, the Acacia minority shareholders will be able to benefit from any future potential upside in both the Acacia assets and Barrick’s broader portfolio of assets.