President of Barrick gets CEO job at AngloGold
JOHANNESBURG/TORONTO: AngloGold Ashanti Ltd hired Barrick Gold Corp president Kelvin Dushnisky as chief executive officer on Monday as the world’s No. 3 gold producer grapples with regulatory challenges from South Africa to Tanzania.
Dushnisky takes over at AngloGold as the Johannesburg-based miner considers its future in its home country, which now accounts for just 13% of total output.
The mining industry in South Africa is protesting rule changes proposed last month by the government and AngloGold is also grappling with new regulations that threaten profits at operations in Tanzania and the Democratic Republic of Congo.
Dushnisky’s responsibilities at Barrick included dealing with host governments and communities, as well as overseeing operations at the world’s largest gold producer.
“Kelvin’s background is in government relations and community stakeholder relations,” Michael Faralla, the head of global mining at TD Securities, said by phone on Monday. “That’s a really big part of what AngloGold needs.”
“Dushnisky will join AngloGold on Sept 1,’’ the company said. He replaces Srinivasan Venkatakrishnan, who will leave AngloGold at the end of August to become CEO of Vedanta Resources Plc.
Dushnisky joined Barrick in 2002, progressing through a number of senior positions and became president in 2015. Under his leadership, and that of executive chairman John Thornton, the company fought its way out from under a heavy debt load, implementing harsh austerity measures.
“The move makes sense as Barrick progresses through a transition period,’’ said Jim Gowans, a mining-industry veteran who has known Dushnisky for more than 20 years and served as co-president of Barrick with him in 2014.
“The role of president at Barrick probably also came with closer oversight from Thornton than Dushnisky will face in his role at AngloGold,’’ he said.
“I think he just needed a new challenge,” Gowans said. “Barrick has a unique structure with the executive chair: you were president but you weren’t really the CEO.”
“Dushnisky may add value to AngloGold as it grows its international footprint, while South Africa shrinks,’’ said Andrew Kaip, an analyst at BMO Capital Markets in Toronto.
The company sold mines in the country to stem losses and now operates just one underground mine and some surface operations in the country.
“He has the global experience,” Kaip said by phone. “He has very much a global understanding of the gold mining industry.”
“One of Dushnisky’s tasks will likely be reversing a discount on AngloGold shares compared with peers,’’ said Pierre Lassonde, the chairman of Toronto-based Franco-Nevada Corp.
AngloGold’s price-earnings ratio is the lowest among the three biggest producers, according to Bloomberg data.
“I said to Kelvin, if the one thing you do is remove that discount, you will have accomplished a great deal as a CEO,” said Lassonde, who has known Dushnisky for 15 years. “If there’s anyone who can do it, it’s him.”