ACTIVIST investor Elliott Management has acquired a substantial position in Barrick Mining, intensifying speculation that the world’s second-largest gold producer could pursue a corporate break-up or significant asset disposals.
The Florida-based hedge fund’s stake places it among Barrick’s ten largest shareholders, representing a holding worth at least $700m, said the Financial Times on Tuesday. Elliott declined to comment on the investment, it added.
The position comes as Toronto-based Barrick pledges to refocus on its more lucrative North American operations following the abrupt September departure of CEO Mark Bristow.
The board, chaired by John Thornton, has recently discussed separating the company’s higher-growth North American business from mines in riskier Asian and African territories, Reuters reported last week.
Such a restructuring would effectively dismantle the modern Barrick created through its 2019 all-stock acquisition of Randgold, said the Financial Times. The board has also considered outright sales of African and Pakistani assets.
Citing people familiar with Elliott’s thinking, the Financial Times said the firm was encouraged by the prospect of splitting Barrick into two distinct entities.
Elliott, founded by Paul Singer and managing $76.1bn in assets, is regarded as Wall Street’s most formidable activist investor and knows the mining sector well, holding a sizeable stake in Anglo American, which recently agreed to merge with Teck Resources.
Barrick’s shares have underperformed rivals despite gold reaching record highs. The stock has gained 55% over five years, compared with 232% for Kinross Gold and 144% for Agnico Eagle. The company has faced setbacks including losing control of a key Malian mine and shareholder concerns about the $9bn Reko Diq copper-gold project in Pakistan’s troubled Balochistan province.
Interim CEO Mark Hill said this month he saw “a big opportunity” in emphasising North American operations, particularly Nevada, calling it the “next big growth area”.
