Thursday, March 11, 2010

Barrick Gold (TSE:ABX) Suing Xstrata

Barrick Gold wants to add Xstrata to Lawsuit

Barrick Gold is attempting to add Xstrata to a lawsuit over a Chilean mine.

The battle is over the attempt by New Gold Inc. to sell the property to Goldcorp.

Barrick sued Goldcorp and New Gold where Goldcorp agreed to advance New Gold $463 million to let it buy a 70 percent stake in the El Morro property from Xstrata Plc. Goldcorp also agreed to pay an additional $50 million to purchase the stake from New Gold, which already owned 30 percent and had right of first refusal.

The case centers around Xstrata agreeing to sell its stake in the property to Barrick for $465 million on Oct. 11, on the condition New Gold’s right of first refusal expired, according to Barrick. Since a shareholder agreement didn't allow the transfer of the stake to a third party, Goldcorp’s acquisition was illegal and Barrick was entitled to complete the transaction, according to Barrick.

Barrick Gold wants to add Xstrata to Lawsuit

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