Barrick's Pueblo Viejo gold mine in Cotui, Dominican Republic, one of three assets the new spun-off company will hold joint-venture interests in, shown in 2013.Ricardo Rojas/Reuters
Barrick Mining Corp. ABX-T is moving forward with plans to spin out its North American assets into a new publicly listed company and also named Mark Hill as its permanent chief executive officer, providing some certainty around its future following an intense period of leadership turmoil.
Barrick has operated in a chaotic environment for the past six months. Former CEO Mark Bristow was ousted in September, with Mr. Hill, a company veteran, appointed as interim CEO in the wake. Two months later, the company’s lead independent director resigned – only six months after joining the board. As this played out, several other senior executives have also turned over, including the miner’s chief financial officer.
Mark Hill had served as interim president and CEO since September.Matthew Plexman/Supplied
Yet through it all, Barrick’s share price has soared after years of underperformance. The price of gold has risen sharply, boosting the bottom line, and the miner also announced a new discovery in Nevada called Fourmile that excited investors.
Amid the turmoil, activist investor Elliott Investment Management L.P. amassed a large stake in Barrick and started pushing a split into two companies – one that would own Barrick’s lower-risk mines in the Americas and another that would hold higher-risk properties in Africa, the Middle East and Asia.
On Thursday, Mr. Hill was named permanent CEO, and the miner also said it would move forward with plans to pursue the split.
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On a conference call, analysts pressed management for details of the split, such as who would run the spun-out company, how much independence it will have from Barrick, and why the timing is right, considering the major asset, Nevada Gold Mines, has had falling production for a number of years.
Mr. Hill’s response was muted. He noted the IPO would likely happen in the fourth quarter of 2026 and reiterated that Barrick’s board determined a split would maximize value for shareholders – although he didn’t provide any details.
The new publicly listed company will hold joint venture interests in: Nevada Gold Mines, Barrick’s operating assets in Nevada; Pueblo Viejo, its operating mine in the Dominican Republic; and the company’s recently announced Fourmile gold discovery in Nevada, which looks to be a new world-class gold deposit, according to analysts.
Barrick will keep its African assets, which includes the Loulo-Gounkoto complex in Mali that has caused problems for the miner of late – the government took control of the project and production was idled – as well as assets such as the undeveloped Reko Diq copper-gold project in Pakistan.
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On the conference call, Mr. Hill was asked what percentage of the North American assets will be sold to new shareholders, and he said it will likely fall around 10 to 15 per cent. That means Barrick will continue to have heavy control and investors will have to judge whether the spin-out changes all that much.
In a recent research note, RBC Dominion Securities valued the North American assets around US$65-billion of Barrick’s roughly US$80-million market value. If the IPO amounts to 10 per cent of the assets, the deal could be worth US$6.5-billion.
Barrick also announced a new dividend policy on Thursday that boosts its quarterly payout to shareholders. The company will now target paying out 50 per cent of its free cash flow.
The miner also reported another death. Barrick had already disclosed a fatal injury in Tanzania in October, and the company said another person died at its project in the Democratic Republic of the Congo in December.
Barrick reported fourth-quarter earnings worth US$1.04 per share, above estimates, but largely owing to lower tax expenses. The miner’s costs rose in the quarter, which worried some analysts, and the company also gave worse-than-expected guidance on costs for 2026.
By late afternoon, Barrick’s shares had fallen 8 per cent on the Toronto Stock Exchange. The S&P/TSX Capped Gold Index was down 6 per cent, largely because of falling gold prices.