Eurasia Mining PLC late Monday said it has agreed to sell its West Kytlim mining operations in the Urals to a Russian company for $9 million, saying the decision reduces the risk the mine will be nationalised by Russia without compensation in response to the freeze of Russian assets in Europe.
Eurasia said the sale of the producing, but loss-making, operations also will allow the company to concentrate on its more resource-rich, and better legally protected, Arctic assets in Russia. It explained that the Arctic assets, including the ‘cornerstone’ Monchetundra-NKT cluster, benefit from an agreement signed in 2021 with state-owned Far East & Arctic Region Development Corp.
Eurasia called a general meeting of shareholders for January 15 to approve the deal, saying company directors and management will vote in favour for their aggregate 19% stake.
Eurasia Mining shares closed up 2.0% to 4.75 pence in London on Monday before the announcement was made. The stock has more than doubled from 2.20p over the past year. The company has a market capitalisation of £140.0 million.
Eurasia said it will sell the West Kytlim assets to LLC KS Logistics, ‘a non-sanctioned infrastructure company in Russia working in transportation, infra-structure development, retail sales and information technology development and management.’
Eurasia will receive 671.2₽ million, about $9 million, saying the price reflects the Russian regulatory framework, put in place in response to sanctions imposed by the US and Europe following Russia’s invasion of Ukraine. This imposes mandatory discounts and tax levies on any asset sale.
Of the total price, 546.2₽ million will be received prior to completion and the remaining 125.0₽ million within 12 months, subject to licences remaining in place.
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