Acacia Mining (LN:ACA) CEO Brad Gordon and CFO Andrew Wray have resigned from the struggling miner. The Barrick Gold (US:ABX) majority-owned subsidiary has been in a struggle with the Tanzanian government almost all year, but its leaders were shunted from the process early in negotiations.
The situation turned to farce in October when Barrick and the Tanzanian government announced a US$300 million goodwill payment for back-taxes that Acacia had no hope of paying.
Gordon and Wray both came to Acacia in 2013, three years after the then-African Barrick was listed as a separate entity in London.
Acacia said Gordon was leaving to return to Australia for family reasons and Wray was “pursuing an opportunity elsewhere”.
Both will officially leave the company at the end of the year.
While some progress was announced last month, Tanzania had not backed down from its $193 billion tax-and-interest bill demand from Acacia and the East African country will now get 50% of the “economic benefits” from the Bulyanhulu, Buzwagi, and North Mara mines.
Acacia has shut down Bulyanhulu because of the Tanzanian concentrate export ban.
The interim CEO is Acacia HR chief Peter Geleta, and finance general manager Jaco Maritz will be permanent CFO.
RBC analyst Richard Hatch said the resignations were not a shock but still could hit Acacia’s already-smashed share price.
“We do view the departures of Mr Gordon and Mr Wray as a negative for sentiment around Acacia shares, particularly given the positive changes both have made to the business since their respective appointments, both in terms of operational and financial performance,” he said.
Acacia chairman Kelvin Dushnisky echoed this sentiment in the company’s statement.
“Brad and Andrew have been instrumental in the operational and financial turnaround of Acacia over the past four years and on behalf of the board and the company, I would like to extend our sincere thanks to both of them for their contributions,” he said.
Acacia’s share price was down 3% in early trade in London at £1.77 (US$2.34), down 68% over the past year. (source: miningjournal)