Barrick confirmed overnight that it had been informed by Newmont that its board had decided to terminate merger discussions.

The Toronto-based company said it believed the combination was in the best interests of shareholders but Newmont’s board had decided that remaining independent was the best option.

A short time later, Newmont took the unusual step of releasing a letter sent to the Barrick board, which was highly critical of co-chairman John Thornton.

Thornton, a former president of Goldman Sachs who was appointed as co-chairman in June 2013, will become chairman of Barrick next week.

It was reported he would be executive chairman of the enlarged entity.

Newmont chairman Vincent A Calarco wrote in the letter that the two companies had been working hard for several months on a deal.

“While we were hopeful that we could achieve that goal, it has become evident to us over the past several weeks that the type of constructive, mutually respectful and partnership-oriented relationship necessary to realise the potential benefits of that combination does not yet exist,” he wrote.

Newmont said it had met a number of times since Thornton declared the merger process as being “dead” last Thursday.

“As you would expect, that unilateral declaration made us question whether we actually shared the vision and values that are necessary to forge a successful new company,” Calarco wrote.

Calarco went on to write that while the discussions with the Barrick management team had been constructive and professional, the same could not be said of discussions with Thornton on certain issues over the past fortnight.

“Our efforts to find consensus have been rejected out of hand repeatedly.

“And, as we contemplated further dialogue, we read in the continuing reporting of the transaction in the financial press a pointed characterisation of our company as ‘extremely bureaucratic and not shareholder-friendly’. Nothing could be further from the truth.”

Calarco said that suggested there was no mutual respect or shared values between the two.

“It is, in fact, because of our deep commitment to our shareholders that we reluctantly have had to unanimously conclude that we need to put aside our attempts to resuscitate this initiative and should pursue our course as an independent company,” he said.

Barrick hit back in a short statement by saying that Newmont had reneged on three foundational elements of the term sheet signed on April 8.

The three sticking points were the location of the head office of the merged company in Toronto; the identification of assets that would be included in a spin-off company; and governance arrangements, particularly over the roles and authority of the chairman, the lead director and the CEO.

Newmont fired back in a further press release, denying Barrick’s claims.

“Newmont did not renege and strongly disagrees with Barrick’s characterisation of events that followed,” the company said.

“As previously disclosed, discussions with the co-chairman of Barrick on certain fundamental strategic and structural issues proved to be unproductive and agreement could not be reached.”

Barrick, the largest gold producer in the world with a market capitalisation of $US20.2 billion ($A21.8 billion), produced 7.1 million ounces of gold in 2013, while Newmont, worth about $12.3 billion as the third largest gold miner, produced 5.1Moz.