Barrick Exit Raises Power Questions at Biggest Gold Miner
(Bloomberg) -- Kelvin Dushnisky’s departure as president of Barrick Gold Corp. raises the question of whether his replacement will get more, or less, power at the world’s largest gold producer under Executive Chairman John Thornton.
Dushnisky, 54, is set to take over as chief executive officer of Johannesburg-based AngloGold Ashanti Ltd. as of Sept. 1, the miners said Monday. Dushnisky, a 16-year veteran at Barrick, worked up the corporate ladder to co-president, then president, where he became responsible for much of the work reducing debt and rationalizing operations. But high-level decisions were understood to be made by Thornton.
Jim Gowans served as co-president of Barrick with Dushnisky in 2014, when the company was struggling beneath a crippling debt burden. “We were selling operations, optimizing them, cutting the head office,” said Gowans, now CEO of Arizona Mining Inc.
With most of that heavy-lifting at Barrick done, and gold in a “transition period” as miners focus on depleting pipelines, Dushnisky will likely welcome the move from president to CEO, albeit at a smaller producer, Gowans said. “It gives him an opportunity to be a CEO. Barrick has a unique structure with the executive chair. You were president but you weren’t really the CEO. I think that was probably a consideration.”
Barrick said Monday it will announce a successor to Dushnisky “in due course.” Michael Faralla, head of global mining at TD Securities Inc., expects Barrick will continue its tradition of trying to find a new leader from within its ranks.
“I don’t necessarily think they’ll have a huge challenge replacing him internally,” Faralla said by phone. “They have strong bench strength.”
One likely frontrunner is Catherine Raw, the miner’s chief financial officer. Hand-picked by Thornton, Raw joined Barrick in 2015 from BlackRock International Ltd., where she had worked as a portfolio manager. In the past year, she has taken on a more public role at Barrick, speaking at industry conferences and to the press.
Weigh on Shares
Raw studied geophysics at Cambridge and mining finance at Imperial College London. Her biggest handicaps might be her age -- she is 37 -- and relatively fewer years of operational mining experience.
Kevin Thomson might also make sense, given the company’s shifting focus toward its Nevada assets. Thomson, a lawyer, has been senior executive vice president of strategic matters for Barrick since 2014.
Another possible internal candidate is Chief Investment Officer Mark Hill, Credit Suisse Group AG analyst Anita Soni said Monday in a note.
“We expect the uncertainty surrounding the change in senior management could weigh on Barrick’s shares today,” Stephen Walker, a Royal Bank of Canada analyst, said in a note Monday.
Barrick fell 2.5 percent to C$15.82 at 11:51 a.m. in Toronto. The shares have dropped 13 percent this year as gold futures declined 6.4 percent in New York. The company is scheduled to report its second-quarter earnings after the close of regular trading Wednesday.
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