Polymetal Acquired by PPF and Two Others

Polymetal, Russia’s largest silver mining operation has been acquired from Aniketa Investments Ltd. by three separate investors. The deal has estimated around USD 2 billion using current valuation numbers, but details have not been officially disclosed.

The three investors, businessmen Alexander Nesis and Alexander Mamut, and Czech investment firm PPF each control less than 25% of the company, meaning they have no obligation to offer buy outs to remaining minority owners. Of the three, PPF gained the biggest stake at 24.9%, Mr. Nesis gained 24%, and Mr. Mamut 19.1%. At the time of the sale the three investors valued Polymetal at just over USD 3 billion.

Polymetal (www.polymetal.ru)
Polymetal is a Russian precious metals mining company producing mainly silver and gold. It is Russia’s largest silver producer and third largest gold producer, and based on 2007 numbers, the fifth largest silver producer in the world. In 2008 the operation produced 17.2 mln. oz. (535 tons) of silver and 285 th. oz. (8.8 tons) of gold.

With headquarters based in St. Petersburg, Polymetal also maintains offices in Moscow and subsidiaries in five Russian regions: Chita, Khabarovsk, Krasnoyarsk, Magadan, and Sverdlovsk. Four major mining operations have been established, three of which were green-field: Khakanja, Lunnoye, and Vorontsovskoye. A fourth mining operation, Dukat, was brown-field. The Polymetal Group also includes five mining exploration companies.

As part of its goal to be the leading operation in discovering, acquiring, and developing Russian gold deposits, Polymetal joined forces in 2006 with AngloGold Ashanti in a 50/50 joint venture. AngloGold Ashanti is the world’s third largest gold producer. The company also managed to acquire the license for the Albazino gold deposit in the Khabarovsk Territory.

PPF Group (www.ppf.cz)
PPF Group is an independent, international private equity group with a specific focus on transitional economies, such as those found in Central and Eastern Europe and Asia. Currently, PPF Group is assessing investment opportunities in Russia, Ukraine, China, and Central and Eastern Europe. PPF Group has offices in London, Prague, Kiev, Moscow, and Beijing.