Barrick Gold signals founder Peter Munk to step down
By Euan Rocha
TORONTO (Reuters) - Barrick Gold Corp (ABX.TO: Quote) signaled on Friday that founder and Chairman Peter Munk is likely to step down from the board at next year's annual meeting, a move sources pinned to concerns surrounding the gold miner's recent $3 billion equity offering.
Sources familiar with the situation say banks underwriting the huge offering have struggled to sell as much as one third of the shares on offer, amid investor concern around corporate governance issues within Barrick, specifically the number of independent board members and the role of Munk.
Munk, 86, has always driven Barrick's agenda: he started the company in 1983 and forged it into the world's largest gold producer. Recent missteps such as the shelving of the costly Pascua-Lama project in the Andes have prompted investors to question the leadership of a man once viewed as a visionary in the mining industry.
In an amended regulatory filing relating to the equity offering, one of the largest in Canadian history, Toronto-based Barrick said it is working to address shareholder concerns.
It indicated that Munk is likely to bow out by the time of the AGM, which is likely to take place in the April.
"The board is addressing the issues that have been raised with our directors, which include modification of the company's executive compensation arrangements, the rejuvenation of the board through a combination of departures from the board, the addition of independent directors and succession in the chairman role at the company, consistent with Mr. Munk's desire to retire as chairman of the board," the filing said.
"The company's intention is to update the market before year end on these initiatives, with governance changes expected to take effect in conjunction with Barrick's next annual meeting."
Barrick said the filing was meant to clear up confusion in the market around the timeline for Munk's departure. Continued...