Peter Munk to Resign as Chair of American Barrick Gold Corp at 2014 Annual Meeting

The restructuring of gold mining company management continues with the announced that Peter Munk the founder and Chair of American Barrick Gold Corporation of one of the World’s major gold mining companies will resign effective at the next annual meeting and also resign as a member of the Board of Directors.

Munk’s resignation comes a week after Charles Panneton, the founder and CEO of Detour Gold abruptly announced his immediate resignation. But the resignation of Peter Munk, now 86 years old was long anticipated, despite his famous quip of five years ago, when the Financial Post asked Peter Munk when he planned to retire from Barrick Gold Corp. Munk responded: “When they kick me out.”

Munk knew that time to retire had arrived after celebrating his 86^th birthday earlier in November, but he wanted to retire on his own terms. He hinted on his birthday he would be announcing his retirement, but did not provide a time…that time came on December 4^th, 2013.

John Thornton, the co-chair at American Barrick since 2012, will become the new chair at the AGM, in late April, 2014

In addition to Munk, Howard Beck and Brian Mulroney will not stand for re-election as Directors at the company’s 2014 AGM.

As in the case of Detour Gold, Barrick’s Investors became disenchanted with several management decisions that the Financial Post described as “strategic errors” and that included the approval of some “outlandish pay packages for company insiders”.

Like Charles Panneton’s role with Detour Gold, Munk was the founder and chief executive officer at Barrick for 30 years. To many he was American Barrick as much as Charles Panneton was Detour Gold. The two became targets of investor criticism and disenchantment.

Among the investors’ concerns was the disclosure in a prospectus for a US$3-billion equity offering that has not sold well with a quarter of the stock unsold. Shareholders were also concerned about the lucrative US $12 million signing bonus given to John Thornton by Munk to entice him to leave Goldman Sachs

Munk’s resignation comes after many of the larger operational problems have been fixed. The Pascua-Lama project was suspended stanching the bleeding of funds from company coffers. The performance of the Lumwana mine in Zambia has improved as well and these factors permit Munk to retire in a more dignified manner than if he had retired six months ago with the company reeling. In August, 2014 Barrick suffered the second biggest quarterly loss in Canadian history last August propelled by more than US$9-billion of impairment charges.

Munk, an immigrant to Canada from Hungary, in just over two decades, built Barrick from a junior into the world’s largest gold producer. He engineered many creative acquisitions during his tenure and followed a unique gold hedging strategy to help steer the company to prosperity and remain strong during bear market in the 1990s. Munk was also extremely lucky as the time he failed to acquire a portion of Bre-X which later was found to be a massive fraudulent operation.