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The logo of sponsor Barrick Gold Corporation is seen as visitors arrive at the Prospectors and Developers Association of Canada (PDAC) annual convention in Toronto, Ontario, Canada March 4, 2019.CHRIS HELGREN/Reuters

The chief executives of Barrick Gold Corp. and Newmont Mining Corp. are working to reach agreement on a critical joint-venture deal that could stave off a high-stakes takeover battle, but deep divisions remain between the world’s largest gold producers.

Barrick CEO Mark Bristow and Newmont CEO Gary Goldberg were scheduled to meet in New York on Tuesday evening to discuss terms of a possible joint venture (JV) at their adjacent Nevada mining operations, according to a source familiar with the talks who was not authorized to speak publicly. Major shareholders of both companies are urging executives to solve long-standing disagreements over the proposal.

Newmont on Monday rejected Barrick’s US$17.8-billion all-stock, zero premium takeover offer, and instead proposed a joint-venture agreement in Nevada between the two companies. Newmont proposed an ownership split of 55 per cent in favour of Barrick with both companies sharing management responsibilities.

Mr. Bristow shot back and said a more equitable split is 63 per cent in favour of Barrick and he insisted that the JV can only work if Barrick is named the sole operator.

Mr. Bristow said he was skeptical the two could reach agreement considering neither has been able to hash out a deal after going back and forth on the idea for two decades but added he was willing to give it “one last try.” The companies have had a long history of hostility between management teams and their respective demands around the possible JV.

Barrick’s biggest shareholder is pushing the company to broker the Nevada joint venture with Newmont rather than pursue a takeover.

“When you put two huge companies like this together, there are no guarantees that you are going to see the value that is promised,” said Joe Foster, portfolio manager of the VanEck International Investors Gold Fund.

“A Nevada joint venture creates the most amount of value for shareholders. The most certain value for shareholders. … This is an opportunity to get that done.” Mr. Foster’s fund along with VanEck’s other holdings own a 6.3-per-cent stake in Barrick and 5.9 per cent of Newmont, according to Refinitiv data.

Simon Jager, portfolio manager with Flossbach von Storch, a German-based institutional investor that is Barrick’s third biggest shareholder and Newmont’s sixth biggest holder, is also undecided.

He said he “liked the idea” of Barrick acquiring Newmont, but is also now considering whether the JV might be a better idea – while also weighing Newmont’s plans to buy Goldcorp Inc. for US$10-billion.

But Mr. Jager also made it clear he isn’t in favour of either Barrick or Newmont getting bigger for bigger’s sake.

“These companies have to put the focus on cash flow and shareholder value, and not on being the biggest,” he said.

Should Barrick and Newmont not reach an agreement over a JV in Nevada, the focus will switch back to Barrick’s all-stock takeover pursuit of Newmont.

Newmont has insisted that its previously announced plans to buy Goldcorp makes far more sense.

With a shareholder vote on Newmont’s US$10-billion deal to buy Goldcorp due to be held in early April, Barrick would have about a month to win over shareholders.

VanEck’s Mr. Foster expressed skepticism on the merits of a mega deal between Newmont and Barrick, saying in an interview that he was undecided on a merger. “I am not a fan of megamergers because I think these companies are big enough as they are.”