In connection with the proposed recommended share-for-share merger of Barrick Gold and Randgold Resources, the companies have agreed on increases in the Randgold and the Barrick dividend, as well as an updated dividend policy for the new enlarged Barrick Group.
Randgold shareholders will be entitled to receive a Randgold dividend of $2.69 a share for the 2018 financial year, instead of the previously announced $2 a share.
Barrick shareholders will, meanwhile, be entitled to a quarterly dividend for the three-month period ending December 31 of up to $0.07 a share, instead of the previously announced $0.05 a share.
Based on Barrick’s strong fundamentals, including stronger cash flow generation, additional overhead cost savings, potential asset sale proceeds and lower interest costs, Barrick will target an annualised dividend of $0.16 a share.
If paid, the increased Barrick fourth-quarter permitted dividend will result in an annualised dividend of $0.16 a share paid to Barrick shareholders in respect of the 2018 financial year.
LOULO-GOUNKOTO
Meanwhile, Randgold reported in a separate release that its Loulo-Gounkoto gold mining complex, in Mali, was stepping up production following the start of the pushback at Gounkoto’s new superpit, with increased grades expected in the third and fourth quarters of the year.
Earlier this week, CE Mark Bristow said that, as guided, the complex’s production profile was weighted towards the back half of the year because of the big pushback’s impact in the first two quarters.
The mine was now getting back to its normal run rate, and there had been an increase in production in the third quarter.
According to Randgold’s GM of operations for West Africa Chiaka Berthe, brownfield exploration on the orebody extensions was confirming the potential for the complex to keep replacing depleted reserves with ounces of the same quality.
“Loulo-Gounkoto is one of the largest operations of its kind in the world and has been a pillar of the Malian economy since Loulo went into production in 2005. The latest exploration results show that its life is likely to extend beyond the current ten-year horizon,” he said.
Further afield, the greenfield exploration team continues to build out targets to the north and south of the Loulo-Gounkoto structures along a 70 km strike in one of the world’s most prolific gold regions.
Elsewhere in Mali, Randgold has entered into discussions on a potential joint venture with the government to explore a regional area of interest to develop a detailed geological dataset.
In terms of the proposal, Randgold will have first choice of identified prospects and the rest will be made available to the government to attract other investors.
The process, the company explained, would offer some private holders of rights in the area the opportunity to become potential equity partners in new ventures.
Bristow said a mediation process was under way to reach an amicable settlement of the Randgold group companies’ tax issues with the government through a jointly appointed facilitator and third-party experts.
“This again demonstrates that our constructive partnership approach is the best way to resolve occasional disagreements with our host governments,” he said.