Shareholders of Russian precious metal miners Polymetal and Polyus Gold decided not to merge their gold assets to create the world's ninth-biggest gold maker, Vedomosti business daily reported on Friday quoting sources.
Polymetal's owners, including Russian businessmen Alexander Nesis and Alexander Mamut and Czech PPF fund, had no objections to the merger. But billionaire presidential candidate and Polyus Gold co-owner Mikhail Prokhorov was against the deal, believing that Polyus does not need additional assets in Russia and that the deal could impede a more profitable merger with one of the world's largest gold market players, sources close to the companies told Vedomosti.
All of the deal participants declined to comment to the paper.
The merger between Polymetal, included in the prestigious FTSE 100 index, and Polyus Gold, currently a Moscow-listed company whose Global Depositary Receipts trade in London, was expected to help Polyus get a listing in the UK.
Polyus announced plans in early October to register its parent company Polyus Gold Plc in the UK, and launched preparations to list its ordinary shares on the London Stock Exchange and be included in the FTSE 100 index.
The company later had to delay its plans after the government's commission on foreign investment headed by Prime Minister Vladimir Putin failed to approve the company's relocation to the UK.
Share prices of the two companies jumped in late January and early February on news of the possible merger.
Polyus Gold shares cost 1,387 rubles ($47) each as of the close of trade on February 9 compared with 1,029 ($35) rubles a week earlier, while Polymetal was at 519.88 rubles ($17.5) per share at Thursday's close, down nine rubles from last week
