Gold mining company Polymetal has closed a deal to sell 100% of the shares of its Russian subsidiary Polymetal JSC for $3.69 billion.
Of these funds, $278 million will be used for general corporate needs, and approximately $1.151 billion will be used to fully repay the debt to Polymetal JSC. Upon closing of the transaction, Polymetal's net cash position will be approximately $130 million.
Earlier on March 7, Polymetal's board of directors approved the sale of its Russian business to Mangazeya Plus JSC by a majority vote.
“We are glad that shareholders supported the sale of the Russian business. With the closing of the transaction, the main risks have been mitigated and now management plans to present a new strategy and capital allocation policy in May,” said Polymetal's CEO Vitaly Nesis.
Meanwhile, the strategy of the Russian company Polymetal JSC will remain unchanged, says the company’s general director Sergei Cherkashin.
The Mangazeya group of companies, which includes the Mangazeya Plus subsidiary, is owned by businessman Sergei Yanchukov. It mines precious metals and has been operating in the Trans-Baikal Territory since 2011. The group's total resource base is about 400 tons of gold.
Theodor Lisovoy, Editor in Chief of the European bureau, Rough&Polished
