List­ing rules forc­ing us out of LSE, says Rand­gold boss

The Daily Telegraph - Business - - Business - By Jon Yeo­mans

THE boss of Rand­gold Re­sources has blamed list­ing rules in the UK for forc­ing the gold miner to aban­don the London Stock Ex­change af­ter its £18bn merger with Bar­rick of Canada.

Mark Bris­tow said re­stric­tive rules meant the new com­pany would have to do a “full IPO [ini­tial pub­lic of­fer­ing]” in or­der to re­tain a foothold on the LSE, threat­en­ing the vi­a­bil­ity of the deal.

“It was a re­quire­ment of list­ing rules in London that even though we are listed as a pre­mium stock in London and Bar­rick is listed in Toronto and New York, we had to do a full IPO,” said Mr Bris­tow.

“That’s many months of work, which was ab­so­lutely im­pos­si­ble. You can’t ex­pect two com­pa­nies to re­main open on a trans­ac­tion for months as you try to re-IPO it.

“It begs the ques­tion why you would not en­cour­age a com­pany that is FTSE 100 to re­main listed on your stock ex­change?”

Mr Bris­tow sug­gested the LSE should look again at its rules ahead of Brexit: “There’s clearly some work still to be done, par­tic­u­larly when there’s a ques­tion mark over London as a con­tin­u­ing cen­tre for cap­i­tal.”

An in­dus­try source noted there was no bar on Bar­rick relist­ing shares in London af­ter it ab­sorbs Rand­gold, even if it can­not join the FTSE 100 be­cause it is not in­cor­po­rated in the UK.

Rand­gold share­hold­ers are ex­pected to wave through the takeover by Bar­rick in a vote today, de­spite com­plaints that the struc­ture of the deal means some funds will have to sell out.

Mr Bris­tow, who will lead the com­bined com­pany, de­fended the de­ci­sion not to of­fer share­hold­ers a cash in­cen­tive to back the all-share deal.

He noted that the share prices of Rand­gold and Bar­rick had risen since the merger was an­nounced, while higher gold prices over the sum­mer had en­abled both com­pa­nies to top up their div­i­dends.

Rand­gold re­ported a 5pc dip year on year in pre-tax prof­its for the three months to Sept 30 to $92m (£70m). Rev­enues slipped 18pc to $243.6m. Gold out­put im­proved as Rand­gold over­came strike ac­tion in Ivory Coast.

One of Mr Bris­tow’s first jobs as Bar­rick chief will be to break the dead­lock be­tween Aca­cia, which is 64pc owned by Bar­rick, and the Tan­za­nian govern­ment over al­leged un­paid taxes.

He said: “I’m very con­fi­dent there’s a con­struc­tive so­lu­tion to be found.”

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