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Barrick Gold (NYSE:GOLD) is pulling a classic move selling gold while it's hot. This week, the company announced it's offloading its 50% stake in Alaska's Donlin project to hedge fund billionaire John Paulson (Trades, Portfolio) and Novagold Resources for $1 billion. That's nearly double what analysts at TD had penciled in. But the big story isn't the price tag it's what Barrick plans to do next. With gold prices flying, the company is cleaning house, unloading underperforming assets while buyers are hungry and valuations are frothy.
CEO Mark Bristow is playing a longer game. Instead of clinging to smaller, short-life mines that barely move the needle like Hemlo in Canada and Tongon in Ivory Coast Barrick is streamlining its portfolio to focus on Tier 1 assets and reallocate capital into copper. And not just any copper. We're talking about a $6 billion project in Pakistan and a potential world-class expansion in Zambia. Bristow's even hinting at a name change from Barrick Gold to Barrick Mining signaling this pivot isn't just tactical. It's existential.
The market has seen this movie before. Newmont dumped over $4 billion worth of smaller gold mines last year twice what it expected as buyers piled in during the gold rally. Barrick's now following suit, using the boom to fuel its transition to a future-facing metal powering EVs, solar, and grid infrastructure. The takeaway? While others chase the shiny stuff, Barrick is using gold's moment to quietly load up on copper and long-term investors should be watching closely.
This article first appeared on GuruFocus.