Barrick Gold Considers Strategic Spin-Off Amid Record Performance

Barrick Mining CA0679011084

The global gold mining sector is witnessing a pivotal moment as industry leader Barrick Gold Corporation undergoes a significant strategic review. With bullion prices sustaining record highs, the company's management is actively exploring a potential separation of its North American operations, a move analysts believe could unlock substantial shareholder value.

A primary driver behind the strategic shift is a notable disparity in market valuation. Currently, Barrick trades at an EV/EBITDA multiple of approximately 7 to 8. In contrast, pure-play North American gold producers often command multiples between 10 and 11. To address this discount, the board has authorized an evaluation of an initial public offering (IPO) for a new subsidiary, internally referred to as "NewCo."

This entity would consolidate Barrick's premier North American assets. These include its interests in the Nevada Gold Mines joint venture and the promising Fourmile development project. The market reacted positively to the prospect; analysts at Jefferies raised their price target on Barrick shares to $55 in early December following the announcement.

Unprecedented Cash Generation Fuels Shareholder Returns

Soaring gold prices, which have surpassed $4,500 per ounce, are generating historic cash flows for the miner. The company's third-quarter 2025 results underscored this financial strength, showcasing several record metrics:

• Operating Cash Flow: $2.4 billion
• Free Cash Flow: $1.5 billion (a corporate record)
• Gold Production: 829,000 ounces
• Copper Production: 55,000 tonnes

This liquidity surge is directly benefiting investors. Barrick has increased its base dividend by 25 percent. When combined with the performance-linked component, the total quarterly distribution now stands at $0.175 per share.

Portfolio Streamlining and Geopolitical Progress

Concurrent with the strategic review, Barrick is sharpening its operational focus. Under the leadership of interim CEO Mark Hill, who assumed the role following Mark Bristow's departure in September, the company is divesting non-core assets. Sales of peripheral holdings, such as the Hemlo mine and stakes in the Donlin Gold project, have generated billions in proceeds. The refined strategy now centers exclusively on "Tier One" assets—mines characterized by long life spans and high annual production.

The company has also successfully mitigated a key geopolitical risk. In November 2025, Barrick reached an agreement with the government of Mali concerning the Loulo-Gounkoto complex. For a payment of $430 million, the company regained operational control and secured a ten-year license extension for the operation.

Future Focus and Timeline

Looking ahead, the remaining core company post any potential separation would intensify its focus on copper growth, particularly through major projects in Pakistan and Zambia. Barrick's share price, which has advanced roughly 198 percent over the past twelve months, already reflects a portion of this robust operational performance. The company has stated it will provide a formal decision and further details on the contemplated "NewCo" IPO when it releases its full-year 2026 results in February.