AFP, Montreal :
Canadian miner Barrick Gold said Friday it is weighing a mammoth bid for American rival Newmont to reclaim its dominance in the gold sector.
In a statement, the company said it had “reviewed the opportunity to merge with Newmont Mining Corporation” but added that “no decision” had been made yet.
Newmont has not commented on the proposed transaction.
If it goes ahead, the US$19 billion hostile takeover would top the previous record deal, set only last month after years of waning investor interest due to lackluster bullion prices.
The industry has been consolidating as gold mines around the world get depleted, driving up costs and encouraging companies to come together in mergers and alliances.
In January, Colorado-based Newmont announced a US$10 billion stock deal for another Canadian mining company, Vancouver-based Goldcorp, in a move to leapfrog Barrick as top gold miner.
That acquisition – which is expected to close in the second quarter – came only three months after Barrick agreed to buy Britain’s Randgold Resources in a US$5.4 billion deal.
But unlike past waves of mergers and acquisitions in the sector that saw big premiums being offered that turned out to be disastrous and burdened buyers with huge debts, Barrick lowered the bar in the Randgold deal.
Barrick and Newmont had flirted with the idea of merging five years ago, but talks fell apart over who would lead the combined firm and where to locate its headquarters – Toronto or Denver.
Canadian miner Barrick Gold said Friday it is weighing a mammoth bid for American rival Newmont to reclaim its dominance in the gold sector.
In a statement, the company said it had “reviewed the opportunity to merge with Newmont Mining Corporation” but added that “no decision” had been made yet.
Newmont has not commented on the proposed transaction.
If it goes ahead, the US$19 billion hostile takeover would top the previous record deal, set only last month after years of waning investor interest due to lackluster bullion prices.
The industry has been consolidating as gold mines around the world get depleted, driving up costs and encouraging companies to come together in mergers and alliances.
In January, Colorado-based Newmont announced a US$10 billion stock deal for another Canadian mining company, Vancouver-based Goldcorp, in a move to leapfrog Barrick as top gold miner.
That acquisition – which is expected to close in the second quarter – came only three months after Barrick agreed to buy Britain’s Randgold Resources in a US$5.4 billion deal.
But unlike past waves of mergers and acquisitions in the sector that saw big premiums being offered that turned out to be disastrous and burdened buyers with huge debts, Barrick lowered the bar in the Randgold deal.
Barrick and Newmont had flirted with the idea of merging five years ago, but talks fell apart over who would lead the combined firm and where to locate its headquarters – Toronto or Denver.
