Gold and silver producer Polymetal International, which had planned to separate its Russian and Kazakh businesses, now intends to sell assets in Russia under US sanctions within six to nine months, CEO Vitaly Nesis said on Wednesday.
Washington in May included Polymetal’s Russian business and Polyus – the largest gold producers in Russia – on its latest list of sanctions targets, aiming to punish Russia for its actions of Ukraine.
Polymetal International completed a re-domiciling process to Kazakhstan from Jersey on Monday.
The sanctions have complicated the company’s plans, Nesis said on an investor call, making an asset sale, for which he said there were a number of interested buyers, the only viable option.
“A spin-off or distribution of the subsidiary to investors are not possible given the sanctions regime,” Nesis said. “As much as we are keen to preserve the shareholder value, we are equally keen not to breach any sanctions.
“And therefore, the sale of the Russian business remains the only reasonable option, which we will pursue in the course of the next several quarters.”
Six to nine months was a realistic timeframe, he said.
Funds from any sale could be used for construction projects in Kazakhstan as well as making dividends to Polymetal International shareholders. Polymetal International was not sanctioned, just its Russian subsidiary.