Barrick's Planned Spinoff Faces Legal and Financial Headwinds

Barrick's plan to spin off its core North American gold assets into a separate public company faces delays due to an undisclosed Teck royalty and a major legal dispute with partner Newmont.

Barrick Gold's strategy to launch a separate publicly traded entity for its core North American gold assets is encountering significant obstacles. Two major issues—an escalating legal dispute and a previously undisclosed royalty payment—are creating uncertainty around the valuation and timing of the proposed initial public offering.

Undisclosed Royalty Impacts Key Project's Valuation

A significant financial consideration for the spinoff entity emerged on March 31, 2026. It was revealed that Teck Resources holds a net profits interest royalty on a substantial portion of Barrick's flagship Fourmile project. This royalty agreement stipulates a 10% rate, escalating to 15% after the production of six million ounces of gold. This liability, apparently not factored into earlier analyst models, is forcing a reassessment of Fourmile's value, a critical asset representing approximately 16% of Barrick's net asset value.

In response, Barrick has stated that the royalty was accounted for within the preliminary economic assessment (PEA) for Fourmile. However, the lack of prior public disclosure regarding this arrangement has raised transparency concerns among some market observers.

Legal Battle with Partner Nears Courtroom

Simultaneously, a partnership dispute with joint-venture partner Newmont is intensifying. The window for an out-of-court settlement has closed after Newmont formally declared Barrick in default on February 3, 2026. The subsequent 30-day grace period ended in late March without resolution, paving the way for the conflict to be settled in a Nevada court.

The core of Newmont's allegation is that Barrick, as the operator of the shared Nevada Gold Mines (NGM) venture—in which Barrick holds a 61.5% stake—diverted equipment and personnel to benefit its own Fourmile development. Newmont's 2025 annual report cites a 23% production decline in the NGM Carlin and Cortez districts, attributing this to a deliberate scaling-back strategy orchestrated by Barrick. Barrick has rejected these claims, citing the terms of the 2019 partnership agreement.

IPO Success Hinges on Resolution

Barrick's board approved the spinoff plan in December 2025, with a formal announcement following on March 13, 2026. The strategy involves placing key North American assets, including its NGM stake, the Pueblo Viejo mine in the Dominican Republic, and the Fourmile project, into a new corporate structure and listing it separately.

The successful execution of this IPO now critically depends on two factors: a clear resolution to the Newmont litigation and full transparency regarding the Teck royalty obligations. Until these overhangs are removed, Barrick's share price is unlikely to fully capitalize on the positive narrative surrounding the spinoff, despite the company reporting robust fourth-quarter results, including earnings per share of $1.04 and revenue of $5.98 billion. Since hitting a 52-week high in late January, the stock has retreated by roughly 21%.