Mark Bristow helped pull off partnership with Newmont; now he
has to make it work
By Jacquie McNish, Alexandra Wexler and Alistair MacDonald
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (March 15, 2019).
TORONTO -- Six months ago, Mark Bristow was the chief of a
midsize African gold miner wrestling with political interference.
Today he heads Barrick Gold Corp., the world's largest gold
producer which this week struck an agreement to pool its Nevada
assets with its nearest rival Newmont Mining Corp.
The two miners had long sought a partnership, but couldn't agree
to terms. "What is amazing is that we were able to convince
everyone that this was a good idea," Mr. Bristow said of the Nevada
partnership.
The 60-year-old South African geologist has been a brash force
in the mining industry ever since he turned around a
financially-strapped junior miner in the 2000s with a winning bet
on the West African country of Mali. He subsequently transformed
that company, Randgold Resources Ltd., and its small portfolio of
remote African gold mines into one of the industry's most
consistently profitable companies.
He has developed mines in some of Africa's most politically
volatile countries, sometimes attacking competitors or politicians
for strategies that he felt hindered sustainable local prosperity.
In 2003, Mr. Bristow launched an unsolicited bid to merge with
Ghana's Ashanti Goldfields, which was twice the size of Randgold.
The attempt was unsuccessful, but established his reputation as an
aggressive deal maker.
Mr. Bristow was named Barrick's chief executive in January after
the company merged with the much smaller Randgold last year. He
described himself to his new executive team as a "consultative
dictator" who planned to dramatically shrink Barrick's Toronto head
office. He said he would spend the bulk of his time visiting mines,
which he told staff suffered under weak management.
At Barrick, he has sought to paint himself as a rough-hewed
miner's miner, in contrast to Executive Chairman John Thornton, an
urbane academic and former Goldman Sachs Group Inc. president. "He
is an email person, I am a talker," Mr. Bristow said at a recent
industry conference in South Africa, describing his relationship
with Mr. Thornton.
His exploits have helped build his image as a maverick. At
Randgold, Mr. Bristow operated out of an office in the English
Channel island of Jersey with seven employees, spending most of his
time piloting one of his five personal planes to far-flung mines.
He estimates he has competed in more than 200 marathons, kayak
races and Ironman triathlons. He climbed Mount Kilimanjaro with one
of his two sons, who was 12 at the time, and led both on motorcycle
treks across Africa. Once, it took paramedics four days to reach
him in Senegal after he was thrown off his motorcycle into a tree
and fractured two vertebrae.
As a child, Mr. Bristow says, he was knocked unconscious or
broke so many bones during sporting events that his father bought a
chair for his mother to sit in by the telephone because there were
so many emergency calls.
"I've always put myself out there," Mr. Bristow said. "You have
to make a difference."
In the early 2000s, when foreign mining giants shed African
assets after Nelson Mandela's rise to power in South Africa stirred
labor activism, Mr. Bristow saw an opportunity to buy cheap mining
properties in hot spots such as Mali, Ivory Coast and the
Democratic Republic of Congo. He staffed Randgold's mines with
locally trained managers and ceded minority stakes to governments.
"I wanted to prove you didn't need outsiders to develop Africa's
mines," he said.
"Running a global miner is his destiny," said Joe Foster,
manager of VanEck International Investors Gold Fund, who invested
in Randgold after meeting Mr. Bristow in 2002 when he was
struggling to raise money to develop the Mali mine.
Overseeing a company the size of Barrick, though, is a new
challenge for Mr. Bristow, especially now that it is tilted
primarily toward production in Nevada, not Africa. At Randgold, Mr.
Bristow oversaw five gold mines in three countries. At Barrick, he
now has a portfolio of 19 mines in 15 countries.
On Monday, Barrick abandoned a $18 billion unsolicited offer for
Newmont and agreed to a much more limited joint venture of the two
firms' Nevada operations. Newmont executives, in defending
themselves to investors against the takeover offer, frequently
pointed to Mr. Bristow's lack of experience leading a large,
globe-spanning company.
The "mystique and awe around Bristow is based around his running
five mines in one continent," Tom Palmer, Newmont's chief operating
officer, said last week before Newmont signed up for the joint
venture.
The two sides now agree they can squeeze hundreds of millions of
dollars annually in savings jointly running the Nevada mines.
Barrick, which controls more assets there, will be the operator of
the venture.
Mr. Bristow said he initiated discussions with foreign
competitors in 2015 to diversify away from his homeland. After a
series of preliminary talks with rivals, he said Barrick's Mr.
Thornton "was the only one who would listen to me."
Last September, Randgold agreed to be acquired by Barrick, which
was struggling with a swooning stock price over investor concerns
about its shrinking gold production. Even before Barrick and
Randgold completed the merger, Mr. Bristow said he was looking for
the next big deal. He and Newmont CEO Gary Goldberg exchanged
messages about a possible combination of their large Nevada
operations, but talks never materialized.
Mr. Bristow was caught off guard when Newmont announced a $10
billion all-share agreement in January to merge with Canadian gold
producer Goldcorp Inc. Barrick responded with a hostile merger
proposal. Eventually, investor support for Barrick's promise of
nearly $5 billion of savings in Nevada nudged the two CEOs to the
table. Six days after Mr. Goldberg joined Mr. Bristow in New York
to discuss the partnership, an agreement for the Nevada joint
venture was announced.
"I'm trying not to stick my finger up their nose anymore," Mr.
Bristow said.
Write to Jacquie McNish at Jacquie.McNish@wsj.com, Alexandra
Wexler at alexandra.wexler@wsj.com and Alistair MacDonald at
alistair.macdonald@wsj.com
(END) Dow Jones Newswires
March 15, 2019 02:47 ET (06:47 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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