Following a hostile takeover attempt by Chinese Minmetals, Equinox Minerals agreed to a friendly takeover by Barrick Gold. The offer, yet to be approved by shareholders, increases the bid made by Minmetals and increases shareholder value. As part of the deal, Equinox agreed to drop its bid for Lundin Mining.

QUESTIONS:

1. What level of strategy would the acquisition of Equinox represent?
2. Do you believe the acquisition of Equinox would be consistent with the core values (even without knowing them) of Barrick Gold? Why or why not? What operating objectives might be satisfied by the acquisition?
3. Analyze the move using SWOT. What does the acquisition offer that leads Barrick to believe it is a good strategic move?
4. How would the acquisition offer competitive advantage for Barrick? Review the typical sources of competitive advantage listed in the Strategy chapter.
5. What are the advantages of the deal in terms of the value chain and/or the supply chain?

SOURCE: The Canadian Press, “Barrick Gold Agrees to Acquire Equinox Minerals in Transaction Worth $7.3B,” Canadian Business (Retrievable online at http://www.canadianbusiness.com/markets/headline_news/article.jsp?content=b6659283)