New owners for Polyus Gold?

M. Prokhorov has found buyers for his stake in the company.

The Onexim group of M. Prokhorov finally sells its package of shares in Polyus Gold with the value of about $4 bln to a group of investors and it has already applied for the approval of the deal to the British regulator. According to Kommersant, the purchasers act in the interests of the 2nd co-owner of Polyus Gold, S. Kerimov, who applies a complicated structure of the deal so as not to make an offer to the minority shareholders. If the deal is signed, M. Prokhorov will lose his last large asset.

M. Prokhorov has agreed on the sale of the belonging to him 38% of shares in Polyus Gold to a group of investors selected by “Naphtha Moscow” of S. Kerimov (holds 40.2% of Polyus Gold), Bloomberg reported referring to 3 secret sources. According to the agency, Onexim group of M. Prokhorov and investors asked the Committee for amalgamation and takeover of Great Britainto approve the structure of the deal, which is supposed to make a decision by the end of Jan. The regulator refused to answer the questions of Kommersant. JP Morgan will provide consulting services, VTB Capital will finance the deal, sources of Bloomberg say. Representatives of the banks don’t comment this information.

This information has led to a sharp listing rise of Polyus on the LSE – by 8 p.m. Moscow time the company rose 10.4%, its capitalization made up £6.7 bln ($10.5 bln). Based on that the package of Onexim was valued at $3.99 bln yesterday. An informed source of Kommersant says the deal is to be held at that price. In September 2012 it became clear M. Prokhorov is ready to sell his stake in Polyus Gold. Then Onexim said it held the negotiations with 2 secret investors, each of which is interested in less than 20% of shares. They thought in the market that Naphtha Moscow of S. Kerimov, that holds 40.2% in Polyus Gold, stands behind the investors. Naphtha Moscow said then that it is merely negotiating with one of the potential buyers upon the financial or other support.

Polyus Gold and Naphtha Moscow yesterday refused to comment. A source familiar with the situation assures this is the 2nd approach of Naphtha Moscow, the scheme is structured in a more complicated way. The buyers offered in September were affiliated with the company of S. Kerimov, and as far as he doesn’t plan to make an offer on the purchase to the minority shareholders of Polyus Gold, now the other investors have been chosen, not connected with Naphtha Moscow. Sources of Bloomberg say the investors won’t have to make an offer on the purchase of shares to the minority shareholders as they will share the package of Onexim between them.

The analyst of Deutsche Bank, E. Danemar, thinks the shareholders of Polyus Gold have different visions of the company’s development: while M. Prokhorov hopes for the alliance with the global players, S. Kerimov, according to the market, considered its amalgamation with Polymetal as an alternative (this information was confirmed by sources of Kommersant close to both companies in the autumn). Possibly the shareholders had different visions for the dividend policy, Mr. Danemar adds. He admits the not mentioned investors can share the strategic interests of Naphtha Moscow. As an example Mr. Danemar names the deal on the amalgamation of Uralkalii and Silvinite where one of the partners of S. Kerimov was A. Nesis – the head of IST group, co-owner of Polymetal. The IST group and Polymetal don’t comment. Sources of Kommersant close to the shareholders of Polyus and IST group assure A. Nesis has nothing in common with investors with which Onexim has agreed.

The analyst of TKB BNP Pariba Investment Partners, A. Litvin, says in fact Polyus is a child of M. Prokhorov who started to collect the gold assets for the future company in the framework of Norilsk Nickel. It was Polyus that allowed M. Prokhorov to recently be called a large Russian entrepreneur, so the deal might become quite nominal for him, the analyst says.



Translated by Galiya Musabekova

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