ESG

Acacia's good run halted by arrests

Tanzanian anti-corruption bureau throws the book at gold miner

Staff reporter

This article is 7 years old. Images might not display.

But no more. 

Tanzania's Prevention and Combating of Corruption Bureau (PCCB) has arrested several Acacia workers past and present for alleged offences relating to tax avoidance.

The list of charges, Acacia said, included tax evasion, conspiracy, a charge under organised crime legislation, forgery, money laundering and corruption.

Tanzania news site IPPMedia said the two most recent arrests were former Acacia VP for corporate affairs Deogratius Mwanyika and Bulyanhulu government relations advisor Alex Lugenda, who were brought before a court in Dar Es Salaam on 39 charges.

Acacia said both men had pleaded not guilty.  

Last week the PCCB charged another man with offences related to land arrangements at North Mara.

Acacia said it was "considering its position" on the arrests while looking into the allegations in more detail.

The company's statement changed between the first and second arrests, with the most recent response outlining in more detail the current state of Barrick's talks with the government over the $190 billion tax bill, and seemingly saying the arrests would inform the parent company's negotiating position.

"[Acacia] is also continuing to engage with Barrick to seek to understand the future conduct and a timetable for the completion of Barrick's direct discussions with the Government of Tanzania, in which the company is not directly involved," Acacia said.

"In particular, the company is seeking to engage with Barrick to understand how the recent significant escalations of Government actions against Bulyanhulu Gold Mine Limited, North Mara Gold Mine Limited and [subsidiary] Pangea Minerals Limited and employees will be taken into account in their direct discussions."

RBC analyst James Bell said it was not a good sign for Acacia shareholders.

"With an international arbitration claim ongoing and the proposed merger of the group's parent with Randgold grabbing international mining headlines it is not entirely surprising to us that the Government of Tanzania has escalated pressure on the group through its recent measures," he said.

"Acacia's 19-month dispute with the GoT may now be entering a more volatile phase which could create more headline risk for shares."

Acacia's shareholders were not overly fazed by the arrests.

The share price (LSE:ACA) was down 1.8% on Thursday to £1.56 (US$2) but it remains up around 50% from a month ago.

 

Expert-led Insights reports and Analytics tools built on robust data, rigorous analysis and expert commentary covering mining Risk, Projects, ESG, Leadership, and Investor Sentiment.

Expert-led Insights reports and Analytics tools built on robust data, rigorous analysis and expert commentary covering mining Risk, Projects, ESG, Leadership, and Investor Sentiment.

editions

ESG Index 2025: Benchmarking the Future of Sustainable Mining

The ESG Index provides an in-depth evaluation of the ESG performance of 60+ of the world’s largest mining companies. It assesses companies across 10 weighted indicators within 6 essential ESG pillars.

editions

Leadership Insights 2025

Leadership Insights reveals key trends in priority mining issues through interviews with 15+ top mining company executives and an industrywide survey.

editions

Mining IQ Risk Analytics

Risk Analytics offers interactive access to World Risk Insight data, allowing you to customise risk views, benchmark jurisdictions, explore data behind scores and read expert commentary to guide your decision-making.

editions

Project Pipeline Index 2025

View our 50 top mining projects, handpicked using a unique, objective selection process from an expanded database of 600+ global assets.