Homestake restructuring should save $25 million

By year-end, Homestake Mining (NYSE) expects to complete a major corporate restructuring which is expected to reduce its annual administrative and exploration expenses by more than $25 million beginning in 1993.

The restructuring of the North American operations follows the recent acquisition of International Corona, and is designed to make the company “more competitive, forward looking and more effective over a broad range of price scenarios.”

In addition to eliminating about 180 positions, the company will close several existing offices and make major personnel changes by year-end. The one-time costs of the restructuring are estimated at about $14 million, and will be charged to this year’s operating results.

Homestake is headed by Harry Conger, chairman and chief executive officer. Former Corona president Peter Steen is now Homestake’s president and chief operating officer.

Corporate headquarters will remain in San Francisco, but the Homestake and Corona offices in Vancouver, B.C., and Reno, Nev., will be combined into one office in each city. Homestake’s offices in Colorado and Houston will be closed.

Future exploration efforts will be carried out mainly from the Reno office, with the main targets being the Homestake gold project in South Dakota and the Eskay Creek project in British Columbia.

Jack Thompson, vice-president, is responsible for Homestake’s operations in Canada. Thompson also replaced John Ivany as president and chief executive officer of Prime Resources Group (VSE) which owns 50% of Eskay Creek.