Polymetal International Buys US$618.5M Gold Project

Polymetal International has agreed to purchase a gold project in Kazakhstan for US$618.5 million, the London-listed mining company said on Thursday.

In a statement, Polymetal said it has entered into binding agreements to acquire Altynalmas Gold (AAG) Ltd, the holding company of Kyzyl Gold Project, located in Northeastern Kazakhstan.

The sale will be paid in cash of US$318.5 in cash and shares worth US$300 million with additional payment of up to US$500 million subject to certain conditions. The deal is also subject to Polymetal shareholders’ approval.

“The Acquisition will increase Polymetal’s gold equivalent reserves by approximately 50%, with a single large high-grade property containing 6.7 Moz gold at 7.5 g/t,“ Polymetal said, and will strengthen the company’s position in Kazakhstan.

Polymetal has been in Kazakhstan since 2009vand has proven and probable reserves of about 8.9 million ounces of gold equivalent as of 1 January 2014.

The Kyzyl gold project is comprised of two deposits and Polymetal plans to establish an open pit mining with the first production tentatively set in 2018.

Shares went up to 550 pence at the opening trading and were priced at 543 pence an hour after London opened.

 

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