Polyus Gold to sell 10% in Russian subsidiary

Polyus Gold International has signed an agreement to sell 10% of the PJSC Polyus’s share capital at $70.6025 a share to a consortium led by Fosun International.

PJSC Polyus is a Russia-based gold producer, with principal operations in Krasnoyarsk, Irkutsk and Magadan regions and the Sakha Republic (Yakutia).

The consortium also includes Hainan Mining and Zhaojin Mining Industry Company, both partially owned by Fosun.

Under the deal, 12,561,868 ordinary shares in PJSC Polyus will be sold. 

The agreement also gives the consortium an option to acquire up to an additional 5% capital at $77.6628 a share, exercisable no later than 31 May 2018. 

PJSC Polyus CEO Pavel Grachev said: “We look forward to our partnership with Fosun, as we continue our efforts to build on our position as a top ten gold producer globally with the lowest cost and a focus on long-term, sustainable growth.

“This transaction also dovetails with Polyus’ strategy of focusing on shareholder value creation as a public company.”

"This transaction dovetails with Polyus’ strategy of focusing on shareholder value creation as a public company."

The transaction is scheduled to complete by the end of this year, subject to certain conditions, including receipt of governmental approvals.

Preliminary approvals have been obtained by the consortium from certain governmental authorities.

Fosun Group executive director and CEO Wang Qunbin said: “As a strategic, long-term shareholder, we are excited to support Polyus as it delivers on one of the most exciting growth profiles amongst the global peer group while providing an attractive dividend yield on our investment.” 

Polyus Gold International is the principal shareholder of PJSC Polyus owning 91.73% of its ordinary shares.

Image: The Closure of the transaction is expected by the end of this year. Photo: courtesy of PJSC Polyus.