Barrick reaches agreement to sell 90% i nterest in the Massawa Project for up to $430 million
PRESS RELEASE
NYSE : GOLD TSX : ABX
Barrick reaches agreement to sell 90% i nterest in the
Massawa Project for up to $430 million
All amounts expressed in U.S. dollars.
TORONTO – December 10, 2019 – Barrick Gold Corporation (NYSE:GOLD)(TSX:ABX) today announced
that it and its Senegalese joint venture partner have reached agreement to sell their aggregate 90% interest
in the Massawa project in Senegal to Teranga Gold Corporation (“Teranga”) for total consideration of up to
$430 million.
The consideration consists of an up- front payment of $380 million, comprised of 20,718,273 Teranga
common shares with a value of $3.85 per share and an aggregate value of approximately $80 million (based
on the same price per Teranga subscription receipt under the concurrent equity offering announced by
Teranga), and a cash payment of approximately $300 million, plus a contingent payment of up to $50 million
which is based upon the average gold price for the t hree year period immediately following closing (“three
year average gold price”). The contingent payment, which is payable three years following closing, is $25
million if the three year average gold price is greater than $1,450 and less than $1,500 per ounce; $35
million if the three year average gold price is greater than $1,500 and less than $1,600 per ounce; and $50
million if the three year average gold price exceeds $1,600 per ounce.
Barrick will receive 92.5% of the total purchase price for its interest in the Massawa project, with the balance
to be received by Barrick’s local Senegalese partner for its minority interest. On a pro forma basis, Barrick
will hold 19,164,403 Teranga common shares, representing approximately 11.45% of Teranga’s issued and
outstanding common shares on closing (calculated on a non-diluted basis).
Barrick is providing $25 million of the $225 million syndicated debt financing secured by Teranga in
connection with the transaction.
Under the terms of an investor agreement to be entered into on closing of the transaction, Barrick will have
the right to nominate one Teranga director for as long as it retains at least a 10% equity interest in Teranga,
and will also be entitled to customary anti-dilution and piggyback registration rights. Barrick has also agreed
to a 24- month standstill pursuant to which Barrick will not increase its share position in Teranga for 18
months, and thereafter may increase its position by an additional 5% over the ensuing six -month period.
The standstill expires after 24 months.
Barrick president and chief executive Mark Bristow said the group had been pursuing the best means of
bringing Massawa – discovered by its legacy company Randgold Resources 10 years ago – to account for
the full benefit of all stakeholders. The agreement with Teranga, which will realise the full value of this
asset and create a substantial new West African gold mining company with significant African ownership,
is the outcome of this process.
“It is gratifying to continue the value-creating consolidation of assets in the gold mining sector which started
a year ago with the merger between Barrick and Randgold, followed shortly thereafter by the merger of the
Nevada assets of Barrick and Newmont Goldcorp. In the case of Massawa, Teranga has the appropriate
infrastructure and processing facilities approximately 25 kilometres away, and combining the orebodies and
the geological prospectivity will add further benefits. This is a good example of an instance where assets
we own might be better suited in combination with others,” he said.
The transaction is expected to close in the first quarter of 2020 and is subject to receipt of the Massawa
exploitation license and residual exploration license from the Government of Senegal, certain other
BARRICK GOLD CORPORATION PRESS RELEASE
acknowledgments from the Government of Senegal and other customary closing conditions. Teranga is a
TSX-listed gold company whose flagship Sabodala gold mine in Senegal is located adjacent to the
Massawa project, creating the opportunity for significant capital and operating synergies.
Barrick is acq uiring Teranga common shares for investment purposes. Depending on market conditions
and other factors, including Teranga’s business and financial condition, Barrick may, subject to the terms
of the investor agreement to be entered into in connection with the transaction, acquire additional common
shares or other securities of Teranga or dispose of some or all of the common shares or other securities of
Teranga that it owns at such time.
An early warning report will be filed by Barrick in accordance with a pplicable securities laws. To obtain a
copy of the early warning report, please contact Kathy du Plessis, whose contact details are included below.
Barrick is a senior gold mining company organized under the laws of the Province of British Columbia.
Barrick’s corporate office is located at Brookfield Place, TD Canada Trust Tower, Suite 3700, 161 Bay
Street, P.O. Box 212, Toronto, Ontario M5J 2S1. Teranga’s head office is located at 77 King Street West,
Suite 2110, Toronto, Ontario M5K 2A1.
Scotia Capital Inc. is acting as financial adviser to Barrick. Davies Ward Phillips & Vineberg LLP and Norton
Rose Fulbright LLP are acting as legal counsel to Barrick.
Enquiries:
Mark Bristow
President and CEO
+1 647 205 7694
+44 788 071 1386
Kevin Thomson
Senior executive vice-president,
strategic matters
+1 416 307-5150
Kathy du Plessis
Investor and Media Relations
+44 20 7557 7738
Website: www.Barrick.com
Cautionary Statement on Forward-Looking Information
Certain information contained in this press release, including any information as to Barrick’s strategy, plans, or future
financial or operating performance, constitutes “forward-looking statements”. All statements, other than statements of
historical fact, are forward-looking statements. The words “expected”, “will”, and similar expressions identify forward-
looking statements. In particular, this press release contains forward-looking statements including, without limitation,
with respect to: timing for completion of the transaction with Teranga; the anticipated benefits from the combination of
the Massawa project with Teranga’s existing assets and the creation of a new West African gold mining company with
significant African ownership; and the eventual payment of the contingent consideration following the third anniversary
of closing.
Forward-looking statements are necessarily based upon a number of estimates and assumptions; including material
estimates and assumptions related to the factors set forth below that, while considered reasonable by Barrick as at the
date of this press release in light of management’s experience and perception of current conditions and expected
developments, are inherently subject to significant business, economic, and compet itive uncertainties and
contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the
forward-looking statements, and undue reliance should not be placed on such statements and information. Such factors
include, but are not limited to: fluctuations in the spot and forward price of gold, copper, or certain other commodities
(such as silver, diesel fuel, natural gas, and electricity); the speculative nature of mineral exploration and development;
changes in mineral production performance, exploitation, and exploration successes; diminishing quantities or grades
of reserves; increased costs, delays, suspensions, and technical challenges associated with the construction of capital
projects; operating or technical difficulties in connection with mining or development activities, including geotechnical
challenges, and disruptions in the maintenance or provision of required infrastructure and information technology
systems; changes in national and local government legislation, taxation, controls, or regulations and/or changes in the
administration of laws, policies, and practices, expropriation or nationalization of property and political or economic
BARRICK GOLD CORPORATION PRESS RELEASE
developments in Canada, the United States, Jersey or Senegal; lack of certainty with respect to foreign legal systems,
corruption and other factors that are inconsistent with the rule of law; risk of loss due to acts of war, terrorism, sabotage
and civil disturbances; timing of receipt of, or failure to comply with, necessary permits and approvals, including
Barrick’s ability to successfully obtain the Massawa mine license from the Government of Senegal; failure to comply
with environmental and health and safety laws and regulations; litigation and legal and administrative proceedings;
damage to Barrick’s reputation due to the actual or perceived occurrence of any number of events, including negative
publicity with respect to the Barrick’s handling of environmental matters or dealings with community groups, whether
true or not; the impact of global liquidity and credit availability on the timing of cash flows and the values of assets and
liabilities based on projected future cash flows; the impact of inflation; fluctuations in the currency markets; contests
over title to properties, particularly title to undeveloped properties, or over access to water, power and other required
infrastructure; employee relations including loss of key employees; business opportunities that may be presented to,
or pursued by, Barrick; our ability to successfully complete divestitures; risks associated with working with partners in
jointly controlled assets; risks relating to Teranga’s ability to realize capital and operating synergies with respect to the
Sabodala gold mine and the Massawa project; increased costs and physical risks, including extreme weather events
and resource shortages, related to climate change; and availability and increased costs associated with mining inputs
and labor. In addition, there are risks and hazards associated with the business of mineral exploration, development,
and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-
ins, flooding, and gold bullion, copper cathode, or gold or copper concentrate losse s (and the risk of inadequate
insurance, or inability to obtain insurance, to cover these risks).
Many of these uncertainties and contingencies can affect our actual results and could cause actual results to differ
materially from those expressed or impli ed in any forward-looking statements made by, or on behalf of, us. Readers
are cautioned that forward-looking statements are not guarantees of future performance. All of the forward-looking
statements made in this press release are qualified by these cautionary statements. Specific reference is made to the
most recent Form 40- F/Annual Information Form on file with the SEC and Canadian provincial securities regulatory
authorities for a more detailed discussion of some of the factors underlying forward-lookin g statements, and the risks
that may affect Barrick’s ability to achieve the expectations set forth in the forward-looking statements contained in this
press release.
Barrick disclaims any intention or obligation to update or revise any forward-looking st atements whether as a result of
new information, future events or otherwise, except as required by applicable law.