This morning, Randgold Resources Ltd. announced its intention to merge with NO premium with Barrick Gold Corp. Mark Bristow, the present Chief Executive Officer of Randgold did the math. Ten years ago, Randgold shares were trading at US$40. They closed yesterday at US$64. Ten years ago, Barrick shares were trading at US$37. They closed yesterday at US$10.50.
While Randgold has demonstrated over the last 15 years outstanding financial discipline, it had become clear that the company needed a drastic profile transformation. Assuming this merger gets approved, it does just that: a combination of financial discipline and a worldwide playground for Mark Bristow with assets on all continents will allow him to express his talent as the new President and CEO of the new entity and reiterate his past performances. John Thornton and Mark Bristow’s interests are aligned. Probabilities are high this duet will deliver on their promises to create value for their shareholders.
If they don’t, who will?
Alain Corbani
Head of Mining & Portfolio Manager
Finance SA, Paris France
