What's Happening?
Newmont Corporation has publicly opposed Barrick Gold's plan to spin off its North American assets, citing ongoing operational disappointments at their Nevada Gold Mines (NGM) joint venture. Newmont, the world's largest gold producer, insists that performance must improve before any sale proceeds. This public statement from Newmont, based in Denver, was issued in response to investor inquiries and media reports about Barrick's separation plans. Newmont expressed dissatisfaction with the management and value erosion at NGM, a partnership formed in 2019 after Barrick abandoned a hostile takeover attempt. The company emphasized that any transaction must adhere to existing joint venture agreements, which include restrictions on transferring ownership
interests. These clauses could hinder Barrick's plan to sell a 10-15% stake in a new North American-focused entity later this year.
Why It's Important?
The opposition from Newmont could significantly disrupt Barrick's corporate strategy, as the Nevada Gold Mines joint venture is crucial to both companies. Barrick holds a 61.5% controlling interest in NGM, while Newmont owns 38.5%. Newmont has highlighted a six-year trend of declining performance and value destruction within the venture. Analysts estimate the value of the Barrick assets under consideration exceeds $60 billion. The potential spinoff package includes NGM, the Fourmile development project, and a mine in the Dominican Republic, also jointly operated with Newmont. Barrick's gold output has declined for six consecutive years, reaching its lowest level in a quarter-century, with further reductions projected for 2026. This track record forms the basis of Newmont's firm stance.
What's Next?
The next significant milestone in this corporate disagreement will be Newmont's earnings release on February 19, covering the fourth quarter and full year 2025. These results will likely demonstrate the seriousness of Newmont's concerns and indicate whether the company is prepared to intensify its opposition to Barrick's strategic move. Market analysts recognize the high stakes involved, as Nevada is central to Newmont's portfolio. Both parties could unlock significant value through improved operational execution. The venture's importance is underscored by the fact that Nevada Gold Mines accounts for approximately 60% of Barrick's total market valuation.
