BlackRock-Backed Russian Gold Miner Starts $500 Million IPO

GV Gold PJSC, a Russian gold miner backed by BlackRock Inc., is planning an initial public offering in Moscow that may raise as much as $500 million.

A group of shareholders including BlackRock plans to sell shares, GV Gold said in a statement on Monday, without giving further details. They’re seeking a valuation for the company of as much as $1.8 billion, people familiar with the matter said, declining to be identified as the information is not public.

Goldman Sachs Group Inc., UBS Group AG, Sberbank of Russia PJSC, VTB Capital, Raiffeisen Bank International AG and Sova Capital are helping to organize the IPO.

Siberian Mines

Russia is on track for a blockbuster year of share sales, led by gold miners, e-commerce companies, and other firms emerging stronger from the pandemic. Initial and secondary public offerings by Russian companies on domestic and foreign exchanges could exceed $10 billion this year, according to VTB Capital. This month, retailer Fix Price’s IPO raised $1.7 billion in the biggest listing from a Russian company in more than a decade.

The deal for GV Gold, one of Russia’s 10 biggest gold miners, was resurrected after bullion climbed to a record in August. The company, also known as Vysochaishy, operates several Siberian deposits. BlackRock owns an 18% stake, which it bought in a 2007 deal valuing the firm at $500 million. The miner is controlled by the owners of Moscow-based Lanta-Bank. They include Sergey Dokuchaev, Natalia Opaleva and Valerian Tikhonov.

Plans for a listing were shelved three years ago amid a slump in commodity prices and the imposition of international sanctions against other Russian companies. Subsequent talks to sell a majority stake to a group led by Fosun International Ltd. fell apart when the parties couldn’t agree on a price.

“In the future we plan to continue developing the potential of our current assets, and to launch two new strategic growth projects –- Krasny and Svetlovskoye,” Chief Executive Officer Vladislav Barshinov said in the statement. The miner is targeting an increase in output, to about 400,000 ounces per year by 2025, from last year’s 272,200 ounces.

Another Russian miner, Nord Gold SE, is planning a share sale in London later this year.

©2021 Bloomberg L.P.

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