10 Sep 2009 18:43

Polymetal shareholders have until Oct 8 to exercise preemptive rights to buy shares

MOSCOW. Sept 10 (Interfax) - Shareholders in Russia's top silver producer Polymetal may exercise their preemptive rights to buy new shares until October 8, the company said in a statement.

The company is issuing 84.375 million ordinary shares for a private placement. Shareholders who oppose the placement or did not vote at the June 19 extraordinary meeting, have the right to buy new shares in proportion to their holdings as of May 14, 2009 at 278 rubles per share.

The supplementary issue amounts to 26.8% of pre-placement charter capital.

Polymetal will use the placement proceeds to finance deals concluded at the beginning of the year. It is placing up to 7.5 million shares for the acquisition of Ayaks, up to 10 million shares to acquire Sopka Kvartsevaya, and up to 66.875 million shares in favor of OJSC Polymetal Management Company, as well as any existing shareholders that wish to exercise their preemptive rights.

Since the start of the year, Polymetal has announced several asset purchases for which company stock could be used as payment. In particular, Polymetal acquired Ayaks from Ovoca Gold in January 2009. Under the terms of the acquisition, Polymetal received 4,166 shares in Ayaks (10.4% of charter capital) and a third party received 35,934 shares (89.6%). In exchange for this stake, Polymetal plans to place 7.5 million supplementary shares.

The company has also agreed to acquire the Sopka Kvartsevaya gold-silver deposit from Lev Levaev's group of companies for 10 million ordinary shares. In addition, Polymetal has acquired a 9% stake in Gold Ore Company Mayskoye LLC from a subsidiary of Highland Gold and could purchase the remaining 91% stake in exchange for either $95.55 million or 15.925 million of its shares.

A source at the company said earlier that the shares acquired by Polymetal Management Company during the additional placement could subsequently be sold to the market.