Polymetal CEO says new shareholder will expedite Russian asset sale

The arrival of gold and silver producer Polymetal International’s new, major shareholder should expedite the sale of its Russian business and it expects to finalize the deal by the end of March, CEO Vitaly Nesis said on Wednesday.

Polymetal is seeking to sell its Russian assets, which were put under US sanctions in 2023 in response to Moscow sending troops into Ukraine in February 2022. In August 2023, the company re-domiciled to Kazakhstan from Jersey and listed on the Central Asian nation’s Astana International Exchange (AIX).

Nesis said in August that Polymetal planned to sell the Russian business in a process that could take six to nine months. It short-listed buyers in September and said both the price and timing of the deal would be impacted by Moscow’s exchange rate-linked export duties and currency controls.

Russian and Chinese companies were among interested buyers, but no names were disclosed.

Nesis on Wednesday confirmed that the company’s new, largest shareholder, a consortium from Oman, considered the sale of the Russian business an “absolute strategic priority”.

Polymetal said on Monday investment company ICT Holding, owned by Russian businessman and Vitaly’s older brother Alexander Nesis, had sold its 23.9% stake in Polymetal to a consortium led by the Omani government.

Vitaly Nesis said it was a coincidence that the ICT stake sale has happened so close to the Russian asset sale, but that the shareholder adjustment was needed before the Russian business could be sold.

“In Russia now, in order to effectively exercise corporate ownership rights, you have to live in Russia”, Nesis told Reuters.

Nesis said the company was determined to put the Russian asset sale to a shareholder vote by the end of February and close the deal by the end of March.

“We have one potential buyer, it’s a Russian buyer,” Nesis said.

“We have to finalize the sale, then have a shareholders’ consultation,” Nesis said, when asked about dividends. “We need to find out what BlackRock thinks, what the Oman fund thinks.”

“I will be asking shareholders a simple question – should we pay dividends, or should we invest in scaling up the company to return it to LSE.”

The Kazakh company’s new strategy will be presented in May 2024, he added.

(By Anastasia Lyrchikova and Alexander Marrow; Editing by David Evans)