Polymetal closes sale of Russian business

MOSCOW. March 11 (Interfax) - Gold and silver miner Polymetal International plc announced on Monday that, following shareholder approval and satisfaction of all other conditions precedent, it has closed a deal to sell its Russian business, JSC Polymetal, to a division of Sergei Yanchukov's Mangazeya Group.

"We are pleased shareholders of Polymetal supported the sale of our Russian business. With the transaction closed and major risks eliminated, we plan to present our new strategy and capital allocation policy in May," group CEO Vitaly Nesis was quoted as saying in Polymetal's press release.

As a result of the deal, Polymetal has deconsolidated $2.20 billion of external net debt, fully settled $1.04 billion of its intragroup liabilities net of tax and received after-tax cash proceeds of $300 million, the company said. Following completion, the group has a net cash position of about $ 130 million.

Following the sale of the Russian business, Polymetal is left with two production facilities in Kazakhstan, Kyzyl and Varvara, as well as the Ertis POX development project. Polymetal's largest shareholders are a consortium of Omani investors led by Omani government-owned fund Mercury Investments International with 23.9%, and BlackRock Inc. with 7.5%.