24 May 2024 11:44

Sweden's Kopy Goldfields to allow minority shareholders to exit at market premium amid pressure from operations in Russia

MOSCOW. May 24 (Interfax) - Sweden's Kopy Goldfields, whose production assets are represented by Amur Zoloto, plans to allow minority shareholders the option to exit capital at a premium to the market amid pressure from the company's presence in Russia, Kopy Goldfields said.

The company said that it is proposing to buy back 156 million shares, about 17% of the capital, at SEK 0.35 per share and reduce the equity capital. By way of comparison, the last closing price for Kopy Goldfields' securities was SEK 0.25 per share on the Nasdaq First North Growth Market in Stockholm. The company could spend a total of SEK 54.5 million, or $5 million, on the buyout.

The company's main shareholders, namely HC Alliance Mining Group and Magomed Bazhaev, who jointly own around 83% of Kopy Goldfields shares, will not participate in the buyout, which is specifically for market minority shareholders.

Kopy Goldfields intends to delist if the main shareholders' stake exceeds 90% upon the results of the transaction.

The company is increasingly coming under pressure from sanctions and other legislative initiatives in both Russia and the European Union, and third-party policy decisions are further hampering cross-border transactions and limiting liquidity and flexibility for Kopy Goldfields shareholders, the company said. Therefore, Kopy Goldfields and its shareholders face increasing challenges and significant risks. The board of directors said that there is interest and pressure on the company and its Swedish shareholders to cease operations in Russia, and it has proposed the option to exit after having evaluated several strategic options.

The buyout is subject to approval at a shareholders meeting, and applications may be submitted from July 3 to 17, inclusive.

Kopy Goldfields completed a reverse acquisition of Amur Zoloto in 2020. The shareholders of the Alliance Group, namely Arsen Idrisov, Musa, and Deni and Magomed Bazhaev, obtained control of the combined company, which is among Russia's top 30 gold miners.