LONDON – Dealmaker Ian Hannam is suing Randgold Resources for up to $18 million he says he is owed for work on its acquisition by Canada’s Barrick Gold (NYSE: GOLD), telling a London court on Friday that the gold miner reneged on their agreement.
Hannam was formerly one of JPMorgan’s top rainmakers and nicknamed the “king of mining” for his record of brokering deals in the resources sector, including the merger of BHP Billiton in 2001 and the 2012 merger of Glencore and Xstrata.
However, his reputation was dented more than a decade ago when he was fined 450,000 pounds (now roughly $574,000) for improperly disclosing information, though his actions were not found to lack integrity.
Earlier this week, Hannam entered the witness box to give evidence for his advisory boutique Hannam & Partners’ case over an agreement he says was reached shortly before Barrick’s 2018 acquisition of Randgold, which says the lawsuit is baseless.
Hannam & Partners says it was promised a minimum of $10 million, with the figure to increase if the deal was worth more than $10 billion.
Its lawyers say Hannam brokered discussions involving Randgold’s then CEO Mark Bristow and Barrick’s then executive chairman John Thornton, which led to the merger.
After Barrick Gold (NYSE: GOLD) and Randgold agreed on a deal ultimately worth some $18 billion, Hannam asked for $18 million but was rebuffed.
“The Barrick-Randgold merger has been hugely successful,” Hannam & Partners’ lawyer Matthew Hardwick said on the first day of the trial on Wednesday, adding: “But for Ian Hannam’s vision, it would not have happened.”
However, Randgold’s lawyer George Spalton said there was no written evidence of the alleged agreement and that $18 million was roughly what Randgold paid its financial advisors, Barclays and Canadian Imperial Bank of Commerce.
Spalton played Hannam a voicemail left by Bristow, now Barrick’s CEO, shortly after Hannam & Partners sent an $18 million invoice, which Bristow said was “completely unprofessional”.
Spalton also referenced Hannam’s 2012 fine for sending two emails on a client’s behalf, suggesting Hannam had a reputation he “could not be trusted with confidential information” which meant Barrick did not want him involved.
Hannam denied that, adding he had accepted his fine and been permitted to open Hannam & Partners by Britain’s Financial Conduct Authority.
“I have apologized and I have taken my punishment,” he said.
The trial is due to conclude next week with a ruling expected at a later date.
