Polyus raises $635 mln selling stakes to CIC, VTB

Tue May 1, 2012 10:49am GMT
 

* Gold producer sold shares to subsidiary of China's CIC

* Company's financial advisor VTB also bought 2.5 pct

* Sales increase free float to 22 pct

LONDON, May 1 (Reuters) - Polyus Gold, Russia's largest gold producer, has sold a 7.5 percent stake to two strategic investors, raising $635 million and helping to boost its free float ahead of plans to apply for a premium listing in London.

Polyus, worth about $10 billion and sitting on potentially lucrative gold reserves in Russia's far east, said on Tuesday it had sold a stake of 5 percent less one share to Chengdong Investment Corporation, a subsidiary of China's CIC, and a 2.5 percent holding to Russian bank VTB.

The company had originally looked at selling up to 10.5 percent of its shares, either through a placing with private institutions or through a wider bookbuilding process, but a source familiar with the transaction had said it could be scaled back due to choppy financial markets.

CIC and VTB, Polyus's financial advisor, stepped in as investors, reinforcing a partnership which saw CIC buy in to the Russian bank when the state floated a 10 percent stake last year.

The shares were sold by Polyus's subsidiary Jenington International.

Polyus said it planned to apply for a premium listing on the London Stock Exchange, a move that would normally require 25 percent of its shares to be freely traded. The 7.5 percent stake sale increases Polyus's free float to 22 percent.   Continued...

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