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Polymetal takes majority stake in "non-core" Veduga

Polymetal (LSE:POLY) will increase its stake in the Veduga gold deposit in Russia’s Krasnoyarsk region to 74.3% by acquiring a 31.7% stake in licence holder Amikan for US$19.7 million worth of shares.
Polymetal takes majority stake in "non-core" Veduga Polymetal takes majority stake in "non-core" Veduga Polymetal takes majority stake in "non-core" Veduga Polymetal takes majority stake in "non-core" Veduga Polymetal takes majority stake in "non-core" Veduga

Polymetal CEO Vitaly Nesis has suggested the enlarged Veduga stake could be sold, as it remains a non-core asset

Staff reporter

Polymetal will issue 2.5 million ordinary shares at $8 each to two Amikan shareholders, Sibproject LC and Malakh Y.

The new shares will account for 0.54% of Polymetal's enlarged total share capital of 455.9 million shares.

The company has applied to for the additional shares to start trading on the London Stock Exchange on October 17.

Polymetal acquired its initial 50% stake in Veduga, which has reserves of 1.4 million ounces at 4.8g/t gold and additional mineral resources of 400,000oz at 4.9g/t gold, in 2006 through a joint venture with AngloGold Ashanti. The stake was subsequently diluted by external equity financing.

Although the company now owns a controlling stake, it has no exact plans for Veduga, with CEO Vitaly Nesis saying multiple strategic options would be explored, including potentially selling the asset, as it remained non-core.

The company's shares were trading at £6.79 (US$8.91) Monday morning, up 2.13%.