B2Gold keen on Barrick’s West African assets
B2Gold stock rises as much as 3% following better-than-expected quarterly production results
Canada’s B2Gold is interested in any West African assets that Barrick Gold may put up for sale after its acquisition of Randgold Resources, B2Gold CEO Clive Johnson says.
B2Gold, whose stock rose as much as 3% on Friday following better-than-expected quarterly production results, is "definitely interested" in any projects considered noncore under the new Barrick, he said in an interview.
Under Barrick’s $6.1bn all-stock deal to buy Randgold, the companies have said they will focus on their biggest and best assets globally and consider selling others.
"If there are opportunities in West Africa that don’t perhaps fit the new Barrick model, in terms of the size of project or other things, then we’d be keen to look," Johnson said on Thursday.
Ideally, the Vancouver-based miner wants projects it can develop to produce about 200,000oz of gold annually for at least 10 years, as opposed to already built mines. It seeks investments with a 20% rate of return at gold prices of $1,200-$1,250/oz, Johnson said.
Randgold has mines and projects in Mali, Ivory Coast, the Democratic Republic of Congo and Senegal, while Barrick has mines in Tanzania and Zambia.
Johnson does not expect Barrick’s acquisition to spark other such transactions and said that B2Gold has not been approached by any larger miners interested in taking it over.
"I think it will be pretty unlikely for a big company to come and make a premium offer for a company like ours. "People have memories of the last 15 years — we’ve seen so many deals done where they’ve become negative."
B2Gold itself is open to making acquisitions, after being on the sidelines since its $570m stock purchase of Australia’s Papillon Resources in late 2014, he said.
That deal landed Fekola, a large, low-cost mine in Mali that helped B2Gold forecast total output at the high end of a 920,000-960,000oz range.
At the end of 2017, there were probable reserves of 2.92-million ounces of gold at the mine.
B2Gold also has five operating mines, two development projects and exploration in Mali, Burkina Faso, Namibia, Nicaragua, Colombia and the Philippines.