The Globe and Mail reports in its Thursday edition that Barrick Gold and takeover target Randgold Resources are boosting their dividend payouts ahead of shareholder votes next week on their $6.1-billion deal (all figures U.S.). A Reuters dispatch to The Globe says that Barrick's all-stock purchase of the African miner, announced in September, spurred some analyst criticism because it lacked a premium for Randgold, which has a record of strong operational and financial performance. Randgold plans to sweeten its 2018 dividend by 35 per cent, to $2.69 a share from $2, and pay it before the merger closes.
The boost reflects Randgold's financial performance year-to-date and dividend policy, Barrick said in a statement. Scotiabank analyst Tanya Jakusconek said she was unsurprised by the boost, because the reduced dividend outlook was a key concern of Randgold shareholders, but noted that the increase is essentially "just a minor tweak." While Randgold requires 75 per cent of votes in support of the deal, Ms. Jakusconek said in a note to clients that she expects the transaction to proceed, citing the companies' share outperformance, tight trading spread and positive recommendations from leading proxy advisory firms.
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