Barrick Gold completes $3bn offering, continues debt tender offer
TORONTO (miningweekly.com) – Barrick Gold, the world's biggest gold producer, on Thursday said it had completed its $3-billion bought deal equity offering of 163.5-million common shares at a price of $18.35 a share, for net proceeds of about $2.9-billion.
The offering increased Barrick’s total common shares outstanding to about 1.16-billion.
Barrick had been looking for ways to reduce its debt load, which stood at $14.6-billion at the end of the third quarter, more than any other major gold producer.
The TSX- and NYSE-listed firm said it intended to use the proceeds to strengthen its balance sheet and improve the long-term liquidity position by using about $2.6-billion to redeem or repurchase outstanding short- and medium-term debt.
The underwriting syndicate was led by RBC Capital Markets, Barclays and GMP Securities.
Specifically, Barrick said it intended to use about $1.1-billion of the net proceeds of the offering to redeem the outstanding $700-million principal amount of 1.75% notes due in 2014, together with the $350-million principal amount of 4.875% notes due in 2014. The notes would be redeemed on December 16.
Barrick would also use about $1.5-billion of the net proceeds of the offering to buy other notes under its tender offer announced at the end of October. The financing condition had now been met.
The balance of the net proceeds would be used by Barrick to further strengthen its balance sheet, which could include further debt reductions and for general corporate purposes, including ongoing operating and capital expenditures relating to Barrick's existing portfolio of mines.
Barrick last month announced that it would indefinitely stop development of its Pascua-Lama mine, in South America, a surprise reversal on a project that had already cost the miner more than $5-billion.
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