Sale of Polyus shares sparks speculation of merger with Polymetal

The sale of Russian billionaire Mikhail Prokhorov's holding in Polyus Gold, a London-listed miner, has prompted speculation of a merger between Polyus and FTSE 100 miner Polymetal.

Following approval from UK regulators, Prohorov sold his stake in Polyus for a total of $3.6bn, which marked a discount to the closing price on Thursday. Zelimkhan Mutsoyev, a big player on the Russian retail scene, purchased 18.5% of Polyus, while Gavriil Yushvayev, a fruit juice tycoon, bought the other 19.28%.

Speculators believe that the deal could lead to a merger between Polyus and Polymetal, which would result in a mining company worth $17bn.

Start your trial of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up for MoneyWeek’s free twice-daily newsletter.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Sign up

VTB CApital analyst Nikolay Sosnovskiy said: "A merger with Polymetal is possible - it will depend on how Polyus will develop."

Back in January Polymetal denied that it was in talks with Polyus.

Polyus' share price was up 1.26% to 221.75p by 14:45, while Polymatal's shares climbed 2.7% to 971.50p.

NR