REG-Polymetal International plc Polymetal: Update on the Company’s Russian-registered subsidiary, JSC Polymetal

Polymetal International PKAnnouncement

05/06/2023 07:00

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   Polymetal International plc (POLY)
   Polymetal: Update on the Company’s Russian-registered subsidiary, JSC
   Polymetal

   05-Jun-2023 / 09:00 MSK

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   Release time IMMEDIATE                             LSE, MOEX, AIX: POLY
   Date         5 June 2023                                     ADR: AUCOY
                                                       

   NOT FOR RELEASE, PUBLICATION OR  DISTRIBUTION, DIRECTLY OR INDIRECTLY,  IN
   WHOLE OR IN PART IN,  INTO OR FROM ANY JURISDICTION  WHERE TO DO SO  WOULD
   CONSTITUTE A  VIOLATION  OF  THE  RELEVANT LAWS  OR  REGULATIONS  OF  THAT
   JURISDICTION.

   THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF  ARTICLE
   7 OF REGULATION 2014/596/EU, WHICH IS PART OF UK DOMESTIC LAW PURSUANT  TO
   THE MARKET  ABUSE (AMENDMENT)  (EU EXIT)  REGULATIONS (SI  2019/310)  ("UK
   MAR").

   Polymetal International plc

   Update on the Company’s Russian-registered subsidiary, JSC Polymetal

   Polymetal International plc  (the “Company”, the  “Group” or  “Polymetal”)
   wishes to  provide a  further update  on the  measures it  is taking  with
   respect to its Russian operations following the recent designation of  the
   Company’s subsidiary, JSC Polymetal (AO Polymetal) by the U.S.  Department
   of State.

   Background

   On 19 May 2023, JSC Polymetal (AO Polymetal), the holding company for  the
   Group’s assets located  in the  Russian Federation,  and its  subsidiaries
   were designated  by the  U.S. Department  of State  pursuant to  Executive
   Order 14024 for operating in the  metals and mining sector of the  Russian
   economy. Following the  designation, and  as previously  announced by  the
   Company, on  22  May 2023  the  Board of  Directors  of the  Company  (the
   “Board”) set up a special committee of independent non-executive directors
   (the “Special Committee”) to ensure full and comprehensive compliance with
   U.S. sanctions and to develop an  appropriate response to ensure that  the
   external challenges facing the Company are addressed in the best interests
   of the Company, its shareholders and other stakeholders.

   Today, the Special Committee provides an update on the latest steps  taken
   by the  Company  to ensure  full  and comprehensive  compliance  with  all
   applicable sanctions  based on  a thorough  review of  the impact  of  the
   designation of  JSC Polymetal  on  the Group  and recommendations  of  the
   Special Committee on advice from external legal counsel.

   Resignation of  the Company’s  top management  from all  positions at  JSC
   Polymetal

     • Vitaly Nesis,  Chief  Executive  Officer,  and  Maxim  Nazimok,  Chief
       Financial Officer, have  resigned from all  executive positions  with,
       and  terminated   their  employment   at,   JSC  Polymetal   and   its
       subsidiaries.
     • Both Vitaly Nesis  and Maxim  Nazimok retain  their current  positions
       with the Company and will continue  to focus on the operations of  the
       Group’s assets located in Kazakhstan, as well as  the re-domiciliation
       of the Company to the  Astana International Financial Centre  (“AIFC”)
       in Kazakhstan as announced on 10 May 2023, and potential separation of
       the Group’s assets by jurisdiction,  as soon as practicable  following
       the re-domiciliation  and  in  full  compliance  with  all  applicable
       sanctions.
     • Pavel Danilin,  the Group’s  Executive  Vice President  for  Strategic
       Development, has resigned from the  Company and JSC Polymetal and  its
       subsidiaries and terminated  his employment with  the Group to  pursue
       other opportunities.

   Ring-fencing  the  Group’s  Russian   subsidiaries  to  ensure   sanctions
   compliance

     • Management of  the  Russian  operations  has  been  delegated  to  the
       executives of JSC Polymetal.
     • Procedures have been  implemented to ensure  that any items  submitted
       for consideration of the Board and the Special Committee are  screened
       for compliance with all applicable sanctions.
     • All service agreements between the Company and its non-Russian
       subsidiaries, and JSC Polymetal and its subsidiaries, have been
       terminated.
     • All payments  from the  Company  and its  non-designated  subsidiaries
       under  other  inter-group  agreements  with  JSC  Polymetal  and   its
       subsidiaries have been discontinued or suspended.

   The Company, its Board, and the Special Committee continue to ensure  that
   the ongoing operations in Kazakhstan  remain unaffected and are  reviewing
   potential restructuring of the current arrangements for the processing  of
   refractory ore mined at Kyzyl deposit in Kazakhstan, with a view to ensure
   that none  of  its subsidiaries  in  Kazakhstan  are exposed  to  risk  of
   sanctions implications.  

   The Company is also evaluating the options to accelerate the  construction
   and commissioning of the Ertis POX  facility in Kazakhstan to sever  fully
   the link between the Company’s subsidiaries in Kazakhstan and its  blocked
   subsidiaries in the Russian Federation.

   Re-domiciliation

   The shareholder circular published on 10 May 2023 (the "Circular") clearly
   stated that the re-domiciliation is unanimously recommended by the Board.

   As announced  on  30  May  2023,  the  relevant  resolutions  required  to
   implement the  re-domiciliation  were passed  at  the General  Meeting  of
   shareholders on  the  same  date. The  re-domiciliation  continues  to  be
   subject to the satisfaction of certain other conditions as set out in  the
   Circular and  will  only  proceed  provided  the  Board  and  the  Special
   Committee  can  be  assured  at  all   times  of  no  risk  of   sanctions
   implications. As at the date hereof,  the Board continues to believe  that
   the re-domiciliation  is in  the best  interests of  the Company  and  its
   shareholders.

   In light of the  designation of JSC Polymetal,  the Board and the  Special
   Committee, with the assistance of  external legal counsel, have  conducted
   an extensive review of the impact  of the designation of JSC Polymetal  on
   the re-domiciliation process. As at the date hereof, based on advice  from
   external legal counsel, the Company believes that re-domiciliation is, and
   continues to be, in full compliance with all applicable sanctions.

   Subject to continuing sanctions compliance, relevant regulatory  approvals
   and satisfaction  of the  remaining  conditions, the  re-domiciliation  is
   expected to proceed as set out in the Circular.

   Strategic considerations on divestment of Russian assets

   In the light of  recent developments, and in  the interests of  preserving
   shareholder value, the  Board and  the Special Committee  have decided  to
   consider all possible  options available for  divestment of JSC  Polymetal
   and its subsidiaries.

   Any potential  transaction will  be  subject to  receipt of  any  required
   corporate, governmental,  and  regulatory  approvals,  in  all  applicable
   jurisdictions, as necessary.

   The Board and the Special Committee will  provide an update by the end  of
   June 2023 regarding  the ongoing  assessment of the  possible options,  if
   any, that  are made  available to  the Company,  and any  progress on  the
   Company’s  strategic  plans,   save  for  any   material  information   or
   developments which may require an earlier announcement.

   The Company confirms that, unchanged to the announcement from 22 May 2023,
   neither the Company, its subsidiaries nor its affiliates are designated as
   sanctions targets of the UK, the EU  or the US, with the exception  solely
   of the  Company’s  Russian subsidiaries  that  are targeted  by  the  U.S.
   blocking sanctions.

   The Company and the  Board reiterate that  they take sanctions  compliance
   very seriously and are fully committed to ensure rigorous compliance  with
   all applicable laws and regulations, including U.S. sanctions.

   Enquiries

       Investor Relations
   Polymetal         1 ir@polymetalinternational.com
   Evgeny Monakhov  +44 20 7887 1475 (UK)
   Kirill Kuznetsov +7 717 261 0222 (Kazakhstan)
                    +7 812 334 3666 (Russia)

    

                           FORWARD-LOOKING STATEMENTS

    

   This release may  include statements  that are, or  may be  deemed to  be,
   “forward-looking statements”. These forward-looking statements speak  only
   as at the date  of this release. These  forward-looking statements can  be
   identified by the use of forward-looking terminology, including the  words
   “targets”,  “believes”,  “expects”,  “aims”,  “intends”,  “will”,   “may”,
   “anticipates”, “would”, “could” or “should” or similar expressions or,  in
   each  case  their  negative  or  other  variations  or  by  discussion  of
   strategies, plans, objectives, goals,  future events or intentions.  These
   forward-looking statements  all include  matters that  are not  historical
   facts. By their nature, such forward-looking statements involve known  and
   unknown risks,  uncertainties  and  other  important  factors  beyond  the
   company’s control  that could  cause the  actual results,  performance  or
   achievements of  the  company  to  be  materially  different  from  future
   results,  performance  or  achievements  expressed  or  implied  by   such
   forward-looking statements. Such forward-looking  statements are based  on
   numerous assumptions regarding the  company’s present and future  business
   strategies and the environment  in which the company  will operate in  the
   future.  Forward-looking   statements  are   not  guarantees   of   future
   performance. There are many factors that could cause the company’s  actual
   results, performance  or  achievements  to differ  materially  from  those
   expressed  in  such  forward-looking  statements.  The  company  expressly
   disclaims any  obligation or  undertaking to  disseminate any  updates  or
   revisions to any  forward-looking statements contained  herein to  reflect
   any change in the company’s expectations with regard thereto or any change
   in events, conditions or  circumstances on which  any such statements  are
   based.

    

    

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   Dissemination of a Regulatory Announcement that contains inside
   information in accordance with the Market Abuse Regulation (MAR),
   transmitted by EQS Group.
   The issuer is solely responsible for the content of this announcement.

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   ISIN:           JE00B6T5S470
   Category Code:  MSCH
   TIDM:           POLY
   LEI Code:       213800JKJ5HJWYS4GR61
   OAM Categories: 2.2. Inside information
   Sequence No.:   248356
   EQS News ID:    1648825


    
   End of Announcement EQS News Service

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References

   Visible links
   1. mailto:ir@polymetalinternational.com


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