Barrick to raise $842M from spinoff

Toronto-based Barrick Gold Corp. said Friday it expects to raise net proceeds of more than $842 million in the first public sale of shares in its new subsidiary, African Barrick Gold.

The 101 million common shares will be sold to institutional investors — such as pension funds — at an initial price of about $8.78 Cdn per share next Wednesday and public trading is expected to begin the same day.

The new company will trade on the main floor of the London Stock Exchange.

Barrick — the world's biggest gold mining company — will hold a three-quarters stake in the new firm.

If demand is good, Barrick may offer another 10.1 million shares.

"As an Africa-focused public company, we believe that African Barrick Gold will be better positioned to generate shareholder value from its operating platform, value which Barrick will continue to benefit from as a majority shareholder," Aaron Regent, the president and chief executive, said in a release.

At its initial share price, African Barrick Gold will have a market value of $3.59 billion.