Barrick Sues Goldcorp for Control of Chilean Mine (Update2)

Jan. 13 (Bloomberg) -- Barrick Gold Corp., the world's biggest gold producer, claims Goldcorp Inc.'s acquisition of a Chilean gold and copper project is illegal and asked a judge to halt the sale pending a trial.

Barrick sued Goldcorp and New Gold Inc. in Toronto today over a Jan. 7 deal under which Goldcorp agreed to advance New Gold $463 million to let it buy a 70 percent stake in the El Morro property from Xstrata Plc. Goldcorp also agreed to pay an additional $50 million to acquire the stake from New Gold, which already owned 30 percent and had right of first refusal.

The El Morro shareholders' agreement prohibits the transfer of rights to a third party, making the Goldcorp transaction illegal, Barrick said in court documents. Since New Gold failed to legally exercise its right of first refusal by a Jan. 11 deadline, that right has now expired, Barrick said.

"Given the significant interests at stake in this proceeding and the very real possibility that the defendants may seek to complete their acquisition," Barrick asked for "an expedited hearing of any motion it may bring" seeking an injunction to block the sale.

Goldcorp acted in good faith "and is confident it acted lawfully and appropriately," the company said in a statement.

New Gold said in a statement it is unaware of any facts that support Barrick's claims.

Bid Trumped

Barrick, based in Toronto, had offered Zug, Switzerland- based Xstrata $465 million for the stake in the project. Xstrata had accepted the Barrick offer "on or about Oct. 11," according to court documents. New Gold and Goldcorp, both based in Vancouver, then trumped Barrick's bid.

The El Morro property is near Barrick's Pascua-Lama and Cerro Casale projects in north-central Chile. El Morro contains 6.7 million ounces of gold and 5.7 billion pounds of copper, Goldcorp said.

Goldcorp and New Gold also illegally induced a breach of the sale agreement and unlawfully interfered with Barrick's economic interests, Barrick said in its statement of claim.

The case is Between Barrick Gold Corp. and Goldcorp Inc., CV-10-8539, Ontario Superior Court of Justice (Toronto).