By Tony D?Altorio
Barrick Gold (NYSE: ABX) is the world?s largest gold producer.
Last year, it mined net profits of $3.3 billion, but it wants more?
So it recently surprised the market with a $7.6-billion bid for Canadian-Australian copper mining company Equinox Minerals (OTC: EQXMF.PK).
Barrick expects to produce 300 million pounds of copper this year, along with about 7.8 million ounces of gold. And with the Equinox acquisition, that copper figure could quadruple.
The move might seem strange for a solid gold company. But Barrick wants to diversify, despite shareholder angst.
African Copper
Barrick isn?t the only company interested in Equinox; China?s Minmetals Resources tried to acquire it, as well. So Barrick stepped in to offer a 16 percent premium to Minmetals? bid.
Industry advisers suggest that the bid hits above the six to eight times EBITDA earnings copper assets usually fetch. And it does amount to 8.5 times
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