Barrick's 15% Slide Sparks Spin-Off Bet-Or a Gold-Asset Trap

Barrick is turning to a spin-off as investor patience wears thin

Barrick is running out of time to convince the market that the sum of its parts is greater than the whole. Shares have fallen 6% over the past week and declined 9.1% over the past month, and the company has dropped from being the largest gold mining company by market capitalization to the third-largest over the past five years. Against that backdrop, the board has asked management to explore a separate listing for its North American assets, including operations in Nevada and the Dominican Republic.

This is first and foremost a valuation attempt. Barrick is testing whether removing its highest-quality, lower-risk assets into a dedicated vehicle can attract a cleaner investor base and narrow the discount to peers. The risk is that the move also exposes how much value is concentrated in the portfolio it is carving out, which makes this more than a simple portfolio reset.

The market discount reflects portfolio mix, not just ore grades

Barrick's valuation problem has increasingly looked like a trust problem. After years of betting on big projects overseas, notably Reko Diq, the company began to look less like a straightforward gold producer and more like a group where the best assets are mixed with distant execution risk. That kind of setup often invites a conglomerate discount.

Why a North American vehicle could matter

RBC's argument is straightforward: Barrick's shares have traded at a discount in part because of above-average geopolitical risk exposure, while the proposed vehicle could trade closer to peer norms because of premier jurisdiction exposure and asset quality. The broader peer comparison strengthens that case. Newmont produced 6.8 million ounces of gold in 2024 and carries a roughly US$99 billion market capitalization, which makes Barrick's North American portfolio look less like an underappreciated collection of mines and more like a credible standalone business.

Once a portfolio is large enough to stand alone, investors are less likely to reward it for simply existing inside a riskier parent. They start expecting clearer strategy, cleaner metrics, and management accountability.

What has to work for the spin-off to succeed

Barrick is outlining more than a structural tweak. The plan includes a dedicated management team, a primary listing expected in New York and a secondary listing in Toronto, and an IPO targeted for completion by the end of 2026. That gives investors a tangible roadmap for judging whether the move creates a cleaner investment case.

The main risk is structural rather than asset-quality. If majority control remains with Barrick and the new entity still operates like a subsidiary, the market may not award it the valuation independence the company is counting on.