UPDATE 1-Barrick mulls options to raise cash, reduce debt -sources

Wed Oct 30, 2013 6:37pm EDT
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By Euan Rocha and Allison Martell

TORONTO Oct 30 (Reuters) - Barrick Gold, which is attempting to reduce its debt load, is considering a wide range of options from a strategic equity investment to further streaming deals that yield upfront cash, according to several sources familiar with the situation.

The sources, who asked not to be named because the talks are confidential, said the discussions have so far been exploratory in nature and no deals are imminent at this time.

A spokesman for Barrick declined to comment on the matter.

One source said Barrick's management has met with top fund managers in Asia and the Middle East to gauge the interest in a possible private placement-style equity deal, in order to raise capital and bring on board a large, long-term strategic investor as a move to boost market confidence in the company.

Such a move would be similar to the one taken by diversified miner Teck Resources Ltd, which in 2009 sold a roughly 17 percent stake in itself to Chinese sovereign wealth fund, CIC or China Investment Corp. At the time, Vancouver-based Teck was struggling under a massive debt load as it acquired Fording Coal for $14.1 billion, just as the global financial crisis began and commodity prices imploded.

Barrick, the world's top bullion miner, has faced a similar struggle over the last year, as the price of gold has fallen 21 percent and costs at Pascua Lama - its massive gold project on the border of Chile and Argentina, have soared.

Shares in Barrick have fallen 46 percent over then last 12 months. The company's shares hit C$14.22 in July, their lowest point since 1992, but have since rebounded a bit and the stock closed on Wednesday at C$21.55.   Continued...