* Gold price rose to 14-month high last week
* Big Acacia shareholders still oppose offer
* Barrick must firm up offer by June 18
By Nichola Saminather and Barbara Lewis
TORONTO/LONDON, June 17 (Reuters) - Ahead of Tuesday's deadline for Barrick Gold Corp to make a firm buyout bid for its Acacia Mining unit, a gold rally has eroded, but not eliminated, a discount and big Acacia shareholders say they still oppose the offer.
Barrick must either firm up its proposal to acquire the 36.1% of Acacia it does not own by June 18, or walk away for at least six months under British takeover law.
In the event opposition melts away and a friendly offer materialises, 75% of the minority shareholders would have to back it. If the bid is not friendly, 90% of the minority shareholders would have to support it.
A gold rally driven by trade and geopolitical tensions propelled gold prices to a 14-month high last week, at the same time boosting gold equities, such as Barrick and Acacia.
By around midday in London (1000 GMT) on Monday, taking into account exchange rates, banking sources said the Barrick indicative offer stood at a 2.1% discount to Acacia's share price, compared with a 9% discount at the time of the offer on May 22.
Acacia investors said the continued, albeit narrowed, premium of Acacia's share price to the bid since the offer implies a better offer should be forthcoming.
Investors have also noted that Barrick valued Acacia at $1.36 billion in 2018.
Aberdeen Standard Investments, a passive investor in both Acacia and Barrick, told Reuters Barrick's offer significantly undervalued Acacia, joining disgruntled shareholders including Fidelity International and Odey Asset Management.
Barrick's offer is an effort to resolve a two-year-long tax dispute with the Tanzanian government and lift a concentrate export ban, after Acacia was shut out of the negotiations.
The Tanzanian government has said it will only deal with Barrick.
Absent a successful bid or resolution to the dispute, Acacia expects to proceed with an international arbitration hearing on July 22, with an outcome expected by the end of the year.
Barrick Chief Executive Mark Bristow has said the offer reflects the increased risk from Tanzania.
While Acacia has not disclosed the amount it would seek in arbitration, the company can claim the value lost due to the government's actions, estimated at $1.3 billion, Barclays analysts wrote in a May 23 note, adding the risks to achieving this are much higher than accepting Barrick's offer.
"If you’re holding Acacia stock, Barrick is offering you a lifeline," said Joe Foster, portfolio manager at Van Eck Associates Corporation, Barrick's third-biggest shareholder. "Why not take the Barrick shares, get the situation resolved, and move on." (Reporting by Nichola Saminather in Toronto and Barbara Lewis in London Editing by Susan Thomas)