Russia’s Polymetal is studying possibility of Kazakh mines demerger

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Small toy figure and gold imitation are seen in front of the Polymetal logo in this illustration

(Reuters) – Russian gold and silver producer Polymetal is analysing the possibility of breaking off its Kazakh mines at the request of a group of investors, it said on Monday, adding that it was premature to speak of a decision.

London-listed Polymetal, which has a free float of 75.2%, is not subject to any Western sanctions imposed on Russia for what Moscow calls “a special military operation” in Ukraine. However, its shares are down 78% amid a global sell-off of Russia-related stocks since the “operation” began on Feb. 24.

Polymetal did not provide any further detail in its comment.

The Financial Times earlier reported that Polymetal was considering whether to split its Russian and Kazakh businesses, each with their own listing, to insulate its international business from the effects of the sanctions on Russia.

Citing two people familiar with discussions, the report added that investors would have the option to retain holdings in both companies, or to sell their shares in the Russian business.

Polymetal produced 1.7 million troy ounces of gold equivalent – a mix of gold and other metals – in 2021, of which 558,000 ounces were produced by its two mines in Kazakhstan.

(Reporting by Reuters; editing by Louise Heavens and Emelia Sithole-Matarise)

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