Barrick Gold's Planned Spinoff Faces Obstacles from Partner Newmont

Barrick Mining CA0679011084

While record profits and a historic gold price should paint a rosy picture for Barrick Gold, significant internal tensions threaten a key strategic move. Plans for an initial public offering (IPO) of the company's premium North American assets are encountering substantial resistance from joint venture partner Newmont Corporation. This dispute casts a shadow over the mining giant's operational control and future corporate structure, even as its financial performance shines.

Barrick's latest financial results demonstrate robust health, providing a strong backdrop to the ongoing corporate disagreement. The company's fourth-quarter 2025 figures reveal:

• Revenue: Increased by approximately 65% to $6 billion.
• Realized Gold Price: Averaged $4,177 per ounce.
• Cash Flow: Generated operating cash flow of $2.73 billion.

Shareholders have directly benefited from the gold rally, with a combined $2.39 billion returned through dividends and share buybacks?a near-record sum.

Newmont Challenges Joint Venture Performance

The core of the conflict centers on the Nevada Gold Mines operation, a cornerstone of Barrick's North American portfolio. Newmont has raised objections, alleging that operational performance within the joint venture has declined under Barrick's management. Recent reports indicate Newmont is exploring protective clauses within the partnership agreement to either block or force a renegotiation of the proposed IPO.

Barrick's strategy involves spinning off its high-quality assets?including its stakes in Nevada and Pueblo Viejo, plus its wholly-owned Fourmile project?into a new, separate entity. The goal is to create a "premium" publicly-traded vehicle, leaving higher-risk projects within the parent company. However, the targeted timeline for an IPO by the end of 2026 is now in jeopardy without an agreement with Newmont. The dispute fundamentally concerns mine efficiency and the equitable distribution of value in a separation.

Market Caution and Cost Pressures

Despite the strong financials, the market response has been muted. Investor caution stems partly from Barrick's cost guidance for the current 2026 year. The company forecasts "All-in Sustaining Costs" to range between $1,760 and $1,950 per ounce. Concurrently, production guidance remains stagnant at 2025 levels, projected between 2.90 and 3.25 million ounces.

A significant bright spot is the Fourmile project in Nevada, where proven resources have doubled for the second consecutive year. To capitalize on this potential, Barrick plans to substantially increase its drilling expenditure for 2026, with a budget of up to $160 million.

Recent trading activity has been characterized by profit-taking, as investors adopt a cautious stance on the company's short-term growth outlook. The resolution of the conflict with Newmont and the successful execution of the premium asset spinoff by year-end are now viewed as critical factors for Barrick's future share price trajectory.