Polymetal International for precious metals production announced on Monday that it had reached a $3.69 billion agreement to sell its Russian assets, taking into account the Russian company’s debt, according to Reuters.
In response to the Russian conflict with Ukraine that started back in 2022, Polymetal was subject to U.S. sanctions, which resulted in the sale of its Russian assets in 2023.
In an attempt to facilitate a sale, the company re-domiciled from Jersey to Kazakhstan in August 2023 and went public on the Astana International Exchange (AIX) of that country.
Under the terms of the agreement, Polymetal International would sell Mangazeya Plus, a division of businessman Sergey Yanchukov’s Mangazeya Mining, 100 per cent of its Russian operations for a sum of approximately $3.69 billion, of which $2.21 billion would cover the net debt of the Russian company, the company said in a statement.
The agreed-upon amount comprises $1.48 billion in cash, of which $1.43 billion is from dividends from the Russian company, to be paid before the sale is finalized. Following the conclusion of the transaction, the company will receive an additional $50 million, according to the statement.
After the deal, Polymetal International, which will continue to be Kazakhstan’s second-largest gold producer, stated that it plans to use $1.15 billion of the dividends to pay down intra-group debt.
The company stated that it will keep the remaining roughly $280 million for internal business uses.
All payments will be made through financial institutions that are not sanctioned, using Russian roubles. Shareholder approval is needed for the deal.
