UPDATE 2-Barrick proposal to acquire Newmont hits roadblock -sources
(Updates share prices, adds Breakingviews link)
By Euan Rocha
TORONTO, April 21 (Reuters) - Talks between Barrick Gold Corp and Newmont Mining Corp about a potential merger have hit a snag, but sources close to the situation say the companies remain keen to reach a deal and discussions are likely to resume.
The talks had been on for a few weeks, and the two sides had broadly agreed to a transaction under which Toronto-based Barrick would acquire Denver-based Newmont in an all-stock deal, said one source close to the matter.
That source said the deal would offer Newmont shareholders a slight premium to its current share price. Newmont shares rose 6.4 percent to close at $25.05 on the New York Stock Exchange, while Barrick's shares edged down 78 cents Canadian to C$19.03.
The sources, who asked not to be named due to the sensitive nature of the situation, said the talks have stalled over the issue of the spin-out of some assets from the combined entity, which is among the hurdles to a deal.
After the close of a tentative deal, shareholders in the combined entity would also get shares in a new company that is likely to include assets in Australia and New Zealand. But the two companies have not yet agreed on a final mix of assets in the spun-out entity, said one source, adding that the new entity could include some assets from outside that region.
The companies are also contemplating selling some non-core assets not included in the spun-out new entity, said one source.
Barrick and Newmont declined to comment on the matter. Continued...