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Acacia investor Odey against any 'best and final' offer from Barrick

Published 2019-06-13, 01:28 p/m
Acacia investor Odey against any 'best and final' offer from Barrick
ACAA
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GOLD
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By Nichola Saminather and Barbara Lewis

TORONTO/LONDON, June 13 (Reuters) - British hedge fund Odey Asset Management said on Thursday it would reject any offer from Barrick Gold Corp ABX.TO GOLD.N for its stake in Acacia Mining Plc ACAA.L that is framed as "best and final," becoming the second Acacia investor to publicly oppose the Canadian mining giant's buyout proposal.

"Odey is not rejecting any specific level of firm offer," the firm, a top 10 shareholder in Acacia, said in an e-mailed statement. "Rather, Odey is preemptively committing to reject a specific style of opening firm offer."

A firm offer of this nature by Barrick would impair the ability of Acacia's board to give a "robust response" that can effect any change, the fund said. Odey owns 1.94% of Acacia shares, according to Refinitiv.

Barrick didn't immediately respond to a request for comment.

Barrick spun off Acacia into a separate company in 2010, but owns 63.9% of the miner, which has three mines in Tanzania. It proposed to take full control of Acacia last month in a deal that valued it at $787 million, nearly an 11% discount to its closing price before the offer, and 42% below Barrick's own valuation of Acacia's assets. has until June 18 to make a formal bid for Acacia or walk away from the deal.

Shares of Acacia have risen 8.1 percent to 172.4 British pence since their pre-offer closing price, while Barrick shares are up 13%. Barrick's stock was trading at C$18.38 in Toronto on Thursday.

The offer followed two years of wrangling over a $190 billion Tanzanian tax bill, with Acacia shut out of the talks and Barrick negotiating on its behalf, despite souring relations. A proposed settlement Barrick announced in February included a $300 million payment to resolve the tax claims.

In the absence of a final deal with Tanzania, Acacia is expecting to go ahead with an international arbitration hearing in July, with an outcome expected by the end of this year.

Odey added that it sees a takeover of Acacia as the only logical way forward for Barrick.

Barrick's discounted offer reflects the risk it takes on by increasing its exposure to Tanzania, the Toronto-based miner's Chief Executive Mark Bristow told Reuters last month. International, the third-largest minority shareholder in Acacia and Barrick's second-biggest investor, told Reuters last month that rejecting the bid was a "no brainer" and showed a lack of judgement on Barrick's part. at Acacia's annual shareholder meeting on Thursday, Barrick abstained from voting on all resolutions.

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