Get the Latest Investment Ideas Delivered Straight to Your Inbox. Subscribe


Barrick Offers to Buy Rest of Project to Resolve Government Dispute
Research Report

Share on Stocktwits


The situation and the gold major's proposal are discussed in a Haywood report.

In a May 23 research note, Haywood analyst Kerry Smith reported that Barrick Gold Corp. (ABX:TSX; GOLD:NYSE) proposed to acquire the remaining 36.1% interest in Acacia, taking Barrick to 100% ownership, to end the two year-long dispute with the Tanzania government.

"The successful resolution would be a positive catalyst, and we view this proposal as a positive step in that direction," added Smith. However, were the acquisition to be successful, improving the relationship with the government of Tanzania will still require much work.

The proposal translates to 0.153 Barrick shares per Acacia share, or a value to Acacia of US$787 million or US$285 million to shareholders of the 36.1% that Barrick does not own. By 5 p.m. on June 18, 2019, Barrick must announce whether or not it intends to make a formal bid.

Regarding the dispute with the East African country that began in 2017, Smith explained, it claimed Acacia owed unpaid taxes of US$193 billion for 2000 through 2017, banned the export of concentrate, impacting Acacia's sales, and indicated it will only communicate with Barrick. Earlier this year, in February, Barrick announced it arrived at a proposal to resolve the outstanding Acacia issues.

In the past week, though, the Tanzanian government said it will not enter a settlement with Acacia and will only sign an agreement if it finds substantial changes have been made to the operating companies' management style.

As for Acacia's current stance, according to a press release issued, Smith noted, it intends to take no action until it clarifies the Tanzanian government's position.

Haywood has a Buy rating and a CA$19 per share target price on Barrick Gold, whose stock is currently trading at around CA$15.88 per share.


1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Disclosures from Haywood Securities, Barrick Gold, May 23, 2019

Analyst Certification: I, Kerry Smith, hereby certify that the views expressed in this report (which includes the rating assigned to the issuer’s shares as well as the analytical substance and tone of the report) accurately reflect my/our personal views about the subject securities and the issuer. No part of my/our compensation was, is, or will be directly or indirectly related to the specific recommendations.

Important Disclosures
The following Important Disclosures apply for Juggernaut Exploration:
▪ Haywood Securities, Inc. has reviewed lead projects of Barrick Gold and a portion of the expenses for this travel have been reimbursed by the issuer.
Other material conflict of interest of the research analyst of which the research analyst or Haywood Securities Inc. knows or has reason to know at the time of publication or at the time of public appearance: n/a.

Research policy is available here.

Want to read more about Gold investment ideas?
Get Our Streetwise Reports Newsletter Free and be the first to know!

A valid email address is required to subscribe