Barrick Gold Corp. has bought itself three more weeks to consider making a formal offer to buy out the minority shareholders of its African unit Acacia Mining Plc.

The Toronto-based miner received an extension until July 9 from the UK takeover panel, Acacia said in a statement. The previous deadline was set to expire Tuesday. Acacia also said it’s open to an offer, “subject to the price offered being fair and commanding the necessary support from shareholders.”

Barrick confirmed the new deadline in its own statement. “This extension will allow for the continuation of discussions with the independent directors and further engagement with Acacia’s shareholders concerning the proposal made to Acacia,” the company said.

Acacia has been in a public battle with Tanzania’s government since July 2017, when the state banned exports of metal concentrates and handed the London-listed gold producer a US$190 billion tax bill, saying it falsely declared bullion exports. Since then, the miner’s relationship has deteriorated further with the government and Barrick.

Informal Proposal

Last month, Barrick said it made an informal proposal to Acacia’s board and management to buy out the minorities, with shares at a ratio that valued all of Acacia at US$787 million. The company has a current market value of about US$900 million. Some analysts and Acacia shareholders have said the indicative offer price was too low.

“In our view these events are a serious failing of corporate governance, as Barrick attempts to exploit the situation in Tanzania,” Alex Wright, a portfolio manager at Fidelity International, said in emailed comments last month. Barrick is trying “to gain full control of Acacia at a price which meaningfully undervalues the company’s assets.”

Some of Barrick’s largest shareholders have a different view.

“It’s not the end of the world to hold Barrick stock instead of Acacia,” Joe Foster, portfolio manager at VanEck, said Tuesday by phone. “If I was an Acacia shareholder, I would want to see the situation resolved and move on, because this has already gone on so long.”

‘Execution Issues’

Acacia has been seeking to resolve some of its issues with Tanzania through international arbitration, expected to begin in London in July. It’s not clear if the new deadline for an offer will overlap with that.

“Generalist investors like us are upset with all the execution issues,” said Simon Jaeger, a portfolio manager at Flossbach von Storch AG, another one of Barrick’s top shareholders. “At some point in time, you have to have a change. You have to come up with something new.”

Jaeger said he “doubts” Barrick Chief Executive Officer Mark Bristow will raise his bid for Acacia and thinks the latter’s shareholders should be weighing the benefits of a deal against the greater risk of delay if arbitration drags on.

“If you have arbitration coming up, your focus will be on this instead of on operations. It’s a big distraction,” Jaeger said. “They should get their heads together and solve it as soon as possible.”

“The best outcome is a resolution and the longer they delay that resolution, the longer it continues to destroy value,” Foster said. “I expect both companies to do what it takes to get a quick resolution.”

--With assistance from Thomas Biesheuvel and Elena Mazneva.