New struggle for Petropavlovsk could restore former executives


A Crypto Tycoon, Banking Heir and the Mysterious Fight for Gold

By Thomas Biesheuvel
Bloomberg News
Monday, May 14, 2018

The battle for some of Russia's richest gold mines has an unusual cast of characters: the scion of one of Europe’s great banking families, a Kazakh tycoon with his own cryptocurrency, hedge fund D.E. Shaw, and mystery shareholders.

They're all part of a new fight for control over Petropavlovsk Plc, a London-listed miner. For the second time in a year, the company is in the middle of a shareholder coup to throw out the board and revive its fortunes.

... Dispatch continues below ...


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A decade ago, Petropavlovsk was worth $3 billion and was mentioned as a future member of the benchmark FTSE 100 Index, but sinking gold prices and management missteps reduced it to a penny stock. The company, started by Pavel Maslovskiy and banking heir Peter Hambro, still owns profitable mines and a new plant that's about to start operating. ...

But to achieve a comeback, Petropavlovsk needs to fix a fissure in the company that has erupted this month.

On one side are a pair of mystery shareholders trying to oust the board and bring back old directors. On the other side are owners including D.E. Shaw that threw out the executives last year.

The two unidentified shareholders -- CABS Platform Ltd. and Slevin Ltd. -- are registered in Gibralter and Anguilla, respectively and own a 9.1 percent stake. It's not publicly known who is behind these holding companies.

The ultimate kingmaker is likely to be Kazakh tycoon Kenes Rakishev, the biggest shareholder and son-in-law of a former Kazakh deputy prime minister. The executive, who holds investments in banks, mobile phones and infrastructure projects, bought a stake in Petropavlovsk in December. ...

The key issue is likely to be whether Petropavlovsk's co-founders will be allowed to return. Rakishev and the new shareholders have called for Maslovskiy to retake the CEO job, but it's an open question whether Hambro will join him.

Hambro has been so closely associated with Petropavlovsk that until 2009 it was called Peter Hambro Mining Plc. He was chairman since founding the firm with Maslovskiy in the early 1990s, and both oversaw the company's rise and fall.

Hambro was ousted last year by shareholders angry about the company's missteps, and Maslovskiy resigned soon after. The group was led by Russian billionaire Viktor Vekselberg and supported by D.E. Shaw, M&G Investment Management Ltd. and Sothic Capital Management LLP.

That coalition has now crumbled. Vekselberg sold his stake to Rakishev, while M&G sold at least some of its holdings to Prosperity Capital. ...

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