(Sharecast News) - A group of investors in Highland Gold, including Russian billionaire Roman Abramovich, announced on Friday the sale of a roughly 40% stake in the company's share capital to Fortiana Holdings at a valuation of approximately $1.4bn.
Cyprus-registered Fortiana also undertook to extend the 300.0p per share cash offer to the remainder of Highland's shareholders, for a 3.8% premium to the prior session's closing prce.
Only one month before, Fortiana, which was controlled by another Russian businessman, Vladislav Sviblov, had sold a near 5% stake in another Russian gold miner, Petropavlovsk, which was currently embroiled in a boardroom battle for control over it.
Sviblov said: "This transaction adds to our existing strategic investments like the Ozernaya Mining Company, which is developing zinc-lead and gold-zinc deposits, as well as several gold mining assets and prospective deposits in the Zabaikalsk region.
"We believe that Highland Gold is an attractive asset that has sustainable cost advantages, attractive deposits as well as a strong and experienced management team. Highland Gold is fundamentally well positioned to further develop its asset and project portfolio, and to monetise its substantial resource base for the benefit of its shareholders."
VTB Bank PSJC would provide the loan to finance the transaction.
Fortiana purchased 145,759,871 Highland Gold Shares from the following Highland Gold Shareholders: Roman Arkadievich Abramovich, Eugene Shvidler, Irina Alexandrovna Panchenko, Andrey Victorovich Gorodilov, Aleksey Leonidovich Polezhaev, New Evolution Trading Limited, Matteson Overseas Limited and Denalot Worldwide Limited.
The cash offer to the remaining shareholders would also be tabled on Friday, the statement released by both companies said. The offer is expected to complete in the fourth quarter of 2020.
The offer is expected to complete in the last quarter of 2020.
Highland Gold was up 3.54% on the London stock market on Friday, trading at a price of 299p a share.
Fortiana Extends Highland Gold Acceptances Offer To November 19