Polyus sells 7.5% of shares to VTB, China's Chengdong
MOSCOW. May 2 (Interfax) - VTB and China's Chengdong Investment Corporation have become shareholders in Polyus Gold International Ltd (controls major Russian gold producer OJSC Polyus Gold ) during the placement of a 7.5% treasury stake in the company, Polyus Gold Int said in a press release.
Jenington, a wholly-owned subsidiary of Polyus, entered into an agreement with Chengdong (subsidiary of CIC International) to sell 5% minus one share (151,607,496 ordinary shares) of the parent company. VTB is acquiring 2.5% of Polyus (50,198,271 shares and 25,153,089 Level 1 GDR (global depositary receipts)).
"The purchase price for the shares is equal to $2.80 per share, and will result in aggregate gross proceeds received from the two transactions equal to $635.5 million. The company expects that the transactions, which are conditioned on one another and subject to other conditions, will be completed on or about May 11, 2012," the press release said.
"The proceeds from the two sale transactions will be used to repay outstanding indebtedness and to finance development projects," it said.
Chengdong and VTB have entered into lock-up agreements stipulating that they will not sell their Polyus shares for 180 days after the completion of the deal. As a result of the acquisition, the two companies will be unable to increase their stakes to above 5% minus one share.