LONDON (Reuters) โ Canadaโs Barrick Gold must pay British dealmaker Ian Hannamโs firm $2 million plus expenses for his work on the acquisition of gold miner Randgold Resources, Londonโs High Court ruled on Wednesday.
Hannam was formerly one of JPMorganโs top rainmakers and nicknamed the โking of miningโ for his record of brokering deals in the resources sector, including the merger that created BHP Billiton in 2001 and the 2012 merger of Glencore and Xstrata.
His advisory boutique Hannam & Partners sued over an agreement he says was reached shortly before Barrickโs 2018 acquisition of Randgold.
Hannam & Partners said it was promised a minimum of $10 million, with the figure to increase if the deal was worth more than $10 billion.
After Barrick and Randgold agreed a deal ultimately worth some $18 billion, Hannam asked for $18 million and was rebuffed.
Randgoldโs lawyers said there was no written evidence of the alleged agreement and that Hannam & Partners was not due any payment.
Judge Simon Gleeson said in a written ruling that โno contract to provide investment advisory services was ever madeโ.
But he added: โThe claimantโs (Hannam & Partnersโ) early work in promoting the transaction conferred a valuable benefit on both Randgold and Barrick.
โBoth Randgold and Barrick recognised this, and intended to make some payment to the claimant in respect of the value which they felt that they had received. They estimated this as being an amount of $2 million.โ
Gleeson said that Hannam & Partners was therefore entitled to $2 million plus its expenses.
Hannam & Partnersโ CEO Neil Passmore said the decision was โa seminal judgment for the investment banking industry with a substantial award of fees for work undertaken on a handshake, despite the fact there was no written contractโ.
Barrick also claimed the ruling as a victory, saying Hannam & Partners had been awarded โthe amount Randgold proposed to pay (Hannam & Partners) in September 2018 for its limited involvement in the transactionโ.
(Reporting by Sam Tobin; Editing by Mark Potter)
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