Wednesday 5 August 2020 11:32 am

UGC owner denies trying to takeover Petropavlovsk ahead of crunch vote

The Russian billionaire who owns a 22 per cent stake in FTSE 250 gold miner Petropavlovsk has denied that he is seeking to take over the firm ahead of a crunch shareholder meeting on Monday.

In an interview with the FT, Konstantin Strukov, who owns rival miner UGC, insisted that he wanted to see Petropavlovsk remain a public company.

Read more: PwC refuses to audit miner Petropavlovsk amid board room battle

“My only wish is to be a shareholder of a big company, which takes my interests into account, which pays dividends”, he said.

However, he added that the firm should have a “fully independent board”, referencing the boardroom strife that has gripped Petropavlovsk over the past couple of months.

Investor Prosperity has claimed that UGC, in concert with three other investors with a total holdings of 39 per cent of the firm’s stock, orchestrated a near-complete clear-out of the firm’s board at its AGM in June.

At the meeting, seven directors, including chief executive Pavel Maslovskiy, were ousted, with four interim directors then appointed.

These included Peter Hambro, the company’s co-founder and scion of the famous banking dynasty.

At Monday’s requisitioned meeting, shareholders will vote on rival proposals from Prosperity and activist investor Everest Alliance.

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The former has proposed reinstating Mavlovskiy and four other directors, while the latter, which has denied claims it is working with UGC, is seeking to add two directors to the existing board.

Proxy advisers ISS and Glass Lewis have recommended investors back Prosperity’s plans.

Strukov also said that he felt like he had been shut out by the miner, claiming that its board was “unwilling to work with me”.

“My impression of the board at Petropavlovsk is that they were unwilling to work with me. I didn’t feel really welcome there.

“As the biggest shareholder I didn’t feel that someone wanted to reach out and talk to me.I nstead they are accusing me of a plan to take over the company”, he said.

The company strongly denied the claims, saying it “could not have done more to welcome Strukov and UGC as its new shareholder in early February”.

“This included a site visit to all of the Petropavlovsk operations and the POX hub, hosted by Pavel Maslovskiy himself, with Struikov, [Maxim] Kharin, and indeed Nikolai Loustiger in his capacity as a major shareholder through Everest and Slevin.

“The site visit between 14-17 February was only a few days before UGC became a shareholder. Face to face meetings took place thereafter in Moscow in March prior to the lockdown.

Read more: Petropavlovsk gold sales surge amid boardroom strife

“Any suggestion of Strukov being ignored is completely untrue”, the statement finished.

Despite the boardroom battle, Petropavlovsk has been one of the best performing stocks on the FTSE 250 over the last year, with shares now more than three times than they were a year ago.

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