$1.3bn Barrick deal abandoned by China

Shandong Tyan Home, which owns Minjar Gold, told investors via the Shanghai Stock Exchange that negotiations for the deal had to be abandoned due to new capital and acquisition rules in China.

“The company is no longer pursuing this project,” Shandong Tyan said.

Barrick has been open to offloading its share in the Super Pit for at least 18 months. The Canadian company has undertaken an extended process of consolidating its operations to reduce debt and increase its cash position.

It bucks the recent trend of Chinese mega deals in the Australian mining sector, with Shandong Tianye Group completing a $330 million purchase of the Southern Cross gold operations in Western Australia.

Yancoal is in the process of acquiring Rio Tinto’s Coal & Allied assets in New South Wales. The deal is likely to be dealt a blow due to the the new capital and acquisition rules.

The Chinese-controlled company posted another annual loss in March, reporting net debt of almost $3.7 billion. This comes in spite of a 130 percent increase in the price of thermal coal between February and October in 2016, and corporate income tax benefits worth $84.7 million.