Polymetal International has appointed Riccardo Orcel as chair after an exodus of directors from the London-listed Russian gold producer’s board following the invasion of Ukraine.

The Italian was previously head of global banking at VTB Capital, the investment banking arm of Russia’s second-largest lender, which is winding down its European operations because of sanctions. He is the brother of Andrea Orcel, chief executive of Italian lender UniCredit and one of Europe’s best-known bankers.

Polymetal’s announcement on Tuesday comes after the FTSE 100 group named four new non-executive directors last week following the abrupt departure of its British chair Ian Cockerill and five other board directors.

The precious metals mining company has escaped direct sanctions but London-listed Russian companies have come under severe pressure because of the west’s response to the invasion.

Steelmaker Evraz, part-owned by billionaire Roman Abramovich, warned on Monday that the inability to meet an interest payment on one of its bonds could force it to default.

Shares in Polymetal, which operates eight mines and a state of the art processing plant in Russia and Kazakhstan, have plunged 88 per cent to 126p in less than a month since Russia’s invasion of Ukraine.

One of its biggest shareholders, Norway’s sovereign wealth fund, has said it will dump all of its Russian investments.

Polymetal said this month it was “shocked and appalled” by the events in Ukraine as it tried to navigate a path between Moscow and London, which has been a source of billions of capital for its expansion.

The company generates a large chunk of its revenue from selling gold to Russian banks, with the central bank viewed as a buyer of last resort. It also sells concentrated gold ore to China for processing.

Since the war began, Russia’s central bank has said it will resume buying gold, two years after it brought an end to a long-running haul that boosted local miners.

Investors are questioning whether the group will pay a dividend or opt to preserve cash as operations for Russian businesses become increasingly tough.

Orcel joined VTB in 2011 having previously worked at Bank of America, rising to become deputy chief executive and head of global banking at VTB’s investment banking arm.

Last year, he spearheaded a VTB-sponsored special purpose acquisition company, Emerging Markets Horizon, that raised $250mn in December. The Spac planned to target high-growth companies in Russia and central and eastern Europe.

It said this month it was evaluating the impact of western sanctions against Russian companies, including VTB.

Orcel was also a non-executive director of Russian mining company EN+ between 2011 and 2018. EN+ is part-owned by Oleg Deripaska, an oligarch who is under UK and US sanctions.



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