Barrick Gold retreats from digital reinvention
CEO plans to sell variety of non-core assets, cut costs and shrink head office leadership
Barrick Gold Corp., the world’s largest gold miner, is selling a research and development company it owns and is cutting staff hired to lead what executives had called a digital reinvention, championed by Executive Chairman John Thornton, according to people familiar with the matter.
The move comes shortly after the company agreed to buy Randgold Resources Ltd. for $6 billion (U.S.) in an all-share merger—a move that would solidify Barrick as the world’s largest gold producer by output.
That merger is set to close next month, and incoming Chief Executive Mark Bristow has said he plans to sell a variety of noncore assets, cut costs and shrink headoffice management in an effort to delegate more authority to regional mining operations.
One of the first assets to go on the block is Barrick-owned AuTec Innovative Extractive Solutions Ltd., a Vancouver-based company that specializes in testing mineral samples and processing, people familiar with the matter said.
In recent months, Barrick has
also disbanded or shrunk technology based teams at its head office in Toronto and at its mining operations in Nevada, according to people familiar with the matter.
The teams were launched by Mr. Thornton to develop things like software that tracked sensors
on underground mining staff, or collected data on processing equipment that could help predict when maintenance was needed, according to these people.
Progress on the projects had been slow, a senior Barrick official told the media late last year.
Last month, Sham Chotai, the miner’s chief digital officer and a former Silicon Valley executive, left the company, according to another person familiar with the matter.
Barrick also cut by around two-thirds its in-house coding hub in Elko, Nevada, and cut staff at s sister site at Henderson, Nevada, according to these people. The miner had described Elko as “the epicenter for Barrick’s ambitious digital transformation” on its website.
Barrick said in September that it was parting with its chief of innovation, Michelle Ashe. All but three of her Toronto-based team of 20 have also left the company, according to a person familiar with the matter.
People working on Barrick’s digitization program said that while the project started well it lacked consistent support at the boardroom level and funding was soon cut, one of the people familiar with the matter said.
A Barrick spokesman said in a statement that technology “will continue to be a key driver” as it looks to shrink corporate management and evaluate all jobs.
Barrick also recently hired bankers to sell its Lagunas Norte gold mine in Peru, other people familiar with the matter said.
The company is also reviewing a possible sale of its Hemlo gold mine in Canada and its 50% stake in its Kalgoorlie mine in Australia, these people said. Barrick has in the past tried to sell these mines, or said that it will.