UPDATE 2-Barrick offers to take Acacia private to solve Tanzania tax dispute

Barrick Gold Corp offered to take full control of its Acacia Mining Plc unit, saying it had chalked up a settlement plan to resolve the company's long-standing tax dispute with the government of Tanzania. Barrick's bid, which values Acacia at $787 million - a discount of about 11 percent to its market value as of Tuesday's close, comes after Tanzania refused to settle directly with Acacia.

Barrick, which already owns 43.8% of Acacia, said it had not yet finalized the settlement and did not outline any details. "It's surprising that Barrick would think the Board of Acacia could accept today's valuation without hearing what has been agreed with the Government," Credit Suisse analyst Conor Rowley said.

"As we stand, Barrick is holding all the information and therefore giving Acacia shareholders no way of knowing whether they are actually getting fair value." Acacia shares fell 9 percent to 146.1 pence, but clawed back some of their early losses to trade down 2.6% at 1433 GMT. Barrick shares were down 0.3% at C$16.19 on the Toronto Stock Exchange.

The Tanzanian government has long accused Acacia of evading taxes for years by under-declaring exports - an allegation, if proven, would have the Africa-focused gold producer pay $190 billion in taxes. Acacia has dismissed the government's claims. Analysts at brokerage Berenberg said there was "little alternative to the Barrick offer," given the government's unwillingness to deal with Acacia.

"This makes the Barrick offer a neat solution to removing Acacia entirely from the equation," the analysts said, adding that Barrick had timed the proposal well. Acacia, which has three mines in north-west Tanzania, said on Wednesday it was left out of talks between Barrick and the Tanzanian government.

The companies have been locked in a war of words with Barrick alleging that Acacia was not cooperating, while Acacia said Barrick's intervention put the miners in "a difficult position". Barrick has offered 0.153 of its own share for each Acacia share, which implies a total consideration of $285 million to the minority shareholders of Acacia.

Under UK takeover panel rules, Barrick currently has until the end of June 18 to make a firm offer for Acacia or walk away from the deal. (Reporting by Karina Dsouza, Manojna Maddipatla and Arathy S Nair in Bengaluru; editing by Gopakumar Warrier and Shinjini Ganguli)