Polymetal Intl. agrees to sell Russian assets at $3.69 bln

Polymetal International for precious metals production announced on Monday that it had reached a $3.69 billion agreement to sell its Russian assets, taking into account the Russian company’s debt, according to Reuters.

In response to the Russian conflict with Ukraine that started back in 2022, Polymetal was subject to U.S. sanctions, which resulted in the sale of its Russian assets in 2023.

In an attempt to facilitate a sale, the company re-domiciled from Jersey to Kazakhstan in August 2023 and went public on the Astana International Exchange (AIX) of that country.

Under the terms of the agreement, Polymetal International would sell Mangazeya Plus, a division of businessman Sergey Yanchukov’s Mangazeya Mining, 100 per cent of its Russian operations for a sum of approximately $3.69 billion, of which $2.21 billion would cover the net debt of the Russian company, the company said in a statement.

The agreed-upon amount comprises $1.48 billion in cash, of which $1.43 billion is from dividends from the Russian company, to be paid before the sale is finalized. Following the conclusion of the transaction, the company will receive an additional $50 million, according to the statement.

After the deal, Polymetal International, which will continue to be Kazakhstan’s second-largest gold producer, stated that it plans to use $1.15 billion of the dividends to pay down intra-group debt.

The company stated that it will keep the remaining roughly $280 million for internal business uses.

All payments will be made through financial institutions that are not sanctioned, using Russian roubles. Shareholder approval is needed for the deal.

 

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Russian court revokes JPMorgan fund seizure

A Russian court overturned the decision to seize a portion of JPMorgan Chase’s assets in Russia amidst a legal dispute with VTB, a state-owned Russian bank, as per court documents cited by Reuters on Thursday.

JPMorgan had previously indicated in a Wednesday filing that its Russian assets were under threat of seizure due to ongoing litigation in both Russian and US courts.

The bank is currently navigating a series of legal hurdles related to its operations in Russia, further complicated by the economic sanctions imposed on Russia by the US and European countries in response to its Ukraine invasion.

Previously, a Russian court had ordered the seizure of funds in JPMorgan’s accounts following a lawsuit by VTB seeking to recover its funds blocked overseas. This order has now been rescinded, marking a new twist in this legal tussle.

Swiss freeze on Russian assets dwindles to $6.36b in ’23

The Swiss authorities have reported a year-over-year decrease of 1.7 billion Swiss francs in the value of frozen Russian assets, bringing the total down to 5.8 billion Swiss francs (approximately $6.36 billion), the Swiss State Secretariat for Economic Affairs (SECO) stated on Tuesday.

The decline in asset value is attributed to the decrease in the value of securities amidst anti-Russian sanctions. During the reporting period, the SECO froze an additional 580 million Swiss francs (about $636 million) in financial assets following investigations and detailed clarifications by banks. SECO also blocked two more real estate properties in Switzerland, bringing the total number of frozen properties to 17.

Other blocked assets include sports and luxury vehicles, works of art, furniture, and musical instruments owned by sanctioned individuals and entities in Switzerland.

The statement further clarified that the amount of frozen assets is separate from the reserves and assets of the Central Bank of the Russian Federation held in Switzerland, which are valued at approximately 7.24 billion Swiss francs (about $7.93 billion). Since March 25, 2022, the Russian central bank’s reserves and assets have been immobilised.

The Swiss authorities noted that the value of the Bank of Russia’s assets may fluctuate due to changes in the valuation of frozen securities, bank charges, and exchange rate movements.

The SECO is Switzerland’s governmental centre of expertise for economic policy that includes economic development cooperation. Together with the Swiss Agency for Development and Cooperation (SDC) and the Peace and Human Rights Division (PHRD) of the Federal Department of Foreign Affairs, it is responsible for implementing Switzerland’s international cooperation file.

Russian asset seizure hits Europe, US unaffected

The confiscation of Russian assets will significantly impact Europe but will not greatly concern the US, according to Professor of Economy and Law at HEC Paris, Armin Steinbach, as reported by TASS on Sunday.

Steinbach noted that Moscow was likely to retaliate with measures primarily targeting European countries, pointing out that the European Union holds at least €200 billion in Russian assets, a figure that far exceeds the amount of Russian funds in the US.

The confiscation of Russian assets could lead investors to lose faith in the EU due to perceived failures in upholding property rights, as this issue is of little concern to an economic powerhouse like the US, Steinbach said.

In related news, the European Commission has given its approval to a proposal that would see revenues from frozen Russian funds used to assist Kiev. The first allocations from this fund could be made as early as July.

BAIC’s EV brand to launch first Huawei-backed sedan in ’24

BAIC BluePark New Energy Technology, the electric vehicle arm of Beijing Automotive Group (BAIC), is set to launch its first sedan in partnership with Huawei Technologies in 2024, Reuters reported on Tuesday.

The first model co-developed with Huawei is expected to be released in the Chinese market this year, according to BAIC BluePark.

The car will be a high-end intelligent sedan designed to meet consumers’ demand for premium mobility experiences, although specific details were not provided.

This collaboration reflects Huawei’s expanding presence in the EV industry, as the Chinese technology giant, which has been the target of U.S. sanctions since 2019, ventures into the territory of established EV manufacturers.

In late 2021, Aito, an electric vehicle brand co-founded by Huawei and carmaker Seres, surpassed Li Auto in sales for the first time in January. This was aided by the launch of the revamped M7 in September.

Additionally, Huawei has partnered with Chinese automaker Chery Auto to develop the S7 sedan under the new Luxeed brand, aiming to compete with Tesla’s Model S.

In November, Huawei announced plans to transfer its core technologies and resources in smart car operations to a new joint venture, in which automaker Changan Auto will hold up to 40 per cent ownership.

Earlier this year, a shortage of a component for the computing unit powering Huawei’s advanced driver assistance systems led to delayed deliveries of flagship models from partners such as Changan, Chery, and Seres, as reported by Reuters.

Yandex to exit Russia in $5.2 bln deal

Yandex N.V., the Dutch parent of Russia’s biggest internet company of Yandex group (YNV) announced on Monday that it has agreed to sell all its Russian assets for 475 billion rubles ($5.2 billion) to a consortium of private investors.

The consortium comprises notable entities such as FMP, Argonaut, Infinity Management and Meridian Servis owned by Alexander Chachava, and IT.Elaboration owned by Pavel Prass.

The deal would see the country’s largest technology player fall entirely under Russian ownership, cementing Yandex’s departure from the Western tech circles it once courted.

Under the terms of the proposed transaction, Yandex N.V. will cease to be the parent company of the group and will change its name and stop using Yandex brands by July 31, 2024, the statement added.

YNV’s Board of Directors were thinking since November 2022 to restructure the group’s ownership and governance in light of the unprecedented and exceptional geopolitical environment, the statement said.