Shares of Canada’s Barrick Mining (B) are up 4% on reports that U.S. activist investor Elliott Management has built a sizable stake in the gold and copper producer.
Media reports say Elliott’s new stake ranks it among Barrick's 10 largest shareholders, which would mean the hedge fund's holding totals at least $700 million U.S.
The exact size of the stake is not known. However, Elliott Management has a history of taking stakes in underperforming companies and then agitating for change.
In the case of Barrick Mining, formerly known as Barrick Gold, the Toronto-based company has largely failed to capitalize on the record run in the price of gold bullion.
Additionally, Barrick's share price has lagged other gold miners in recent years as the company faced setbacks that include the loss of a key mine in Mali.
Reports say Elliott Management might want to split Barrick into two companies, separating its higher-growth North American operations from mines in riskier areas such as Asia and Africa.
Barrick's board of directors has reportedly discussed splitting the business into two, as well as outright sales of its African and Pakistan mine assets.
Elliott Management has experience with the mining sector as it holds a sizable stake in Anglo American (AAL), which recently agreed to merge with Teck Resources (TECK).
Barrick Mining has not commented publicly on reports of Elliott Management’s stake. The stock of Barrick is up 131% this year and trading at $36.96 U.S. per share.
