viewBarrick Gold Corp.

Barrick Gold, Goldcorp sell Marigold mine to Silver Standard Resources


Barrick Gold (NYSE:ABX)(TSE:ABX) says it is selling its one-third stake in the Marigold mine in Nevada to Silver Standard Resources (TSE:SSO) for a total of $86 million, with the deal expected to close this April. 

The world's largest producer of gold has a 33.3% stake in Marigold, with the remainder held by Goldcorp (TSE:G) (NYSE:GG), the world's second biggest producer of the yellow metal. Goldcorp also agreed to sell its majority interest in the Nevada mine as part of a joint deal, for a total of $275 million in cash between the two parties.

Barrick's share of production last year at the mine was about 55,000 ounces of gold, according to its statement, at all-in sustaining costs of roughly $1,545 per ounce. 

The divestiture, in coordination with Goldcorp, is part of Barrick's ongoing process to optimize its portfolio to maximize free cash flow. 

Excluding today's sale, over the past six months, the company has announced a series of divestitures of short life, high cost and non-core assets, for a total consideration of about $850 million. In late January, Barrick said it was selling its interest in two mine operations in Western Australia for AU$75 million in cash. 

The sale of the Kanowna Belle and Kundana operations to Northern Star Resources Ltd. is expected to close in March.

The divestments come after a terrible year for the miner, with 2013 marking a period of write-downs, cost overruns and a shareholder rebellion over executive compensation, most notably co-chair John Thornton's multi-million dollar signing bonus amid a cratering gold market. 

Earlier in December, the gold giant announced a series of high level personnel changes, starting with news that founder and chair Peter Munk is to step down from the Toronto-headquartered miner’s board of directors at Barrick's next annual meeting of shareholders. Thornton, Munk’s co-chair since 2012, will attempt to fill the 86-year-old’s shoes, taking over the position of chairman effective as of the same meeting, likely to occur in late April.

Shares of Barrick declined over 1% on Tuesday, to $21.19 in Toronto.

Quick facts: Barrick Gold Corp.

Price: 35.21 CAD

Market: TSX
Market Cap: $62.61 billion

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