In addition to the immediate repayment, Gazprombank also provided notice to return about $87.1m due under the group’s Russian units’ revolving credit facilities by 26 April.
The notice sent on Wednesday represents another setback for the miner, one of the biggest gold producers listed on the London Stock Exchange. Since the invasion of Ukraine by Russia, its shares have fallen by nearly half of their value, with the group now worth less than £100m.
The group’s principal assets are four hard-rock gold mines in the Amur region, in the Russian far east. As a result, the majority of the group’s cash reserves are held in Russia, limiting the groups’ ability to transfer the cash-out.
In addition, Petropavlovsk has substantial commercial and financial relationships with Gazprombank. The bank acts as an off-taker of the group’s entire gold production, but due to sanctions, the miner has been prohibited from any payment to the lender.
Consequently, last week, the company stated that it had begun to consider putting itself up for sale due to the challenges in paying off the $304m loan by November.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData