Zambia’s antitrust authorized the sale of Equinox Minerals Limited to Canadian based miner. Barrick Gold for USD 7.7 billion on condition that the 2.2% stake owned by minority shareholders is sustained.
Meanwhile Equinox Minerals, owners of Lumwana Copper Mine in Zambia acknowledged the review by the potential buyer, Barrick Gold Corporation of the conditional authorization issued by the Zambian Competition and Consumer Protection Commission of the proposed acquisition by Barrick of the outstanding common shares of Equinox by way of takeover bid.
The antitrust agency added that while it endorses the proposed “takeover of the global miner by another competitor, Barrick Gold Corporation the sale should affect the 2.2% shares in Equinox that Zambia Consolidated Copper Mines-Investment Holdings holds in the company.
Spokesperson Mr Brian Lingela said in a statement that the authorization for the proposed buy off of Equinox Minerals was granted on the understanding that the new order would not raise any competition concerns because Barrick Gold Corporation had no presence in Zambia. The acquisition was therefore unlikely to lead to a situation that could substantially lessen competition in the mining sector.
During a meeting of the board of the antitrust agency it was noted that the transaction raised public interest concerns with regard to the need to support the local businesses and local empowerment employment and environment concerns.
Therefore, the final authorization is on condition that Barrick Gold Corporation shall undertake to honour the subsisting agreements that Lumwana Copper Mines has entered into with the local smelter, local suppliers to mine and other third line industries. It was the desire of the board of the antitrust that Barrick Gold Corporation would support the Zambian Government policy on citizen empowerment and take reasonable steps to ensure that no jobs are lost by virtue of the transaction.
Since Lumwana Mine may in future extract uranium, there is also a condition that it should protect people and the area from potential radioactive hazards that uranium pose, among other conditions outlined by the agency. Last week the Zambia Competition and Consumer Protection Commission granted final conditional authorization to Barrick Gold Corporastion of Canada to takeover Equinox Minerals Limited, 100% owners of Zambia’s Greenfield, Lumwana Copper Mining in Solwezi in north western Zambia.
The board of commissioners during its 24th extraordinary meeting approved the proposed acquisition of 100% shareholding of Equinox Minerals by Barrick Gold Corporation of Canada. Equinox Minerals Limited is an international mining and exploration company that owns a 100% interest in Zambia’s Lumwana Copper Mine, lying 65 kilometers west of Solwezi.
According to data, Barrick Gold Corporation is the World’s leading gold mining company in terms of production, reserves and market capitalization. It operates gold and copper mines in Canada, US, the Dominican Republic, Australia, Papua New Guinea, Peru, Chile, Argentina, Pakistan and Tanzania. Barrick Gold is expected to either reject or honour the stated conditions prior to the sale which has been deadlined for June 1st 2011.
And Equinox Minerals’ spokesperson said in a statement that the company appreciates the timeliness of the Zambia’s antitrust approval process to date and notes Barrick's statement that discussions with the CCPC relating to modifying the terms of its conditional authorization are ongoing. The Offer is open for acceptance until 5:00 PM on June 1st 2011 unless the Offer is extended or withdrawn.
On April 25th 2011, Equinox announced an agreement with Barrick Gold Corporation pursuant to which Barrick has agreed, subject to the terms of a support agreement, to make the Offer to purchase all outstanding common shares of Equinox by way of negotiated take-over bid at a price of CAD 8.15 per share in cash. Barrick subsequently commenced the Offer on April 26th 2011. The Equinox board of directors has unanimously recommended that Equinox shareholders ACCEPT the Offer and DEPOSIT their shares under the
Offer.
However, several players said that they were keenly following the proposed transaction between two major global leading mining companies particularly that Zambia was expected to benefit more than USD 171 million from the sale of the Equinox by virtue of Lumwana mine being hosted in Zambia.
(Filed by Mr Kapembwa Sinkamba SteelGuru Correspondent Zambia)
