Ejected Polymetal in Moscow listing

  • @MLeftly

Polymetal International, the Russian gold producer that is set to be ejected from the elite FTSE 100 this month, will start trading shares in Moscow tomorrow as it shores up its investor base.

Chief executive Vitaly Nesis told The Independent last week that setting up a secondary listing in Moscow was "imminent" and industry sources confirmed this should kick-off tomorrow. Polymetal, which also mines for silver and platinum, stopped trading in its home country after becoming one of the first two Russian companies to join the FTSE 100 in 2011.

The other was steel giant Evraz, part-owned by Roman Abramovich. The companies joined at the same time and the London Stock Exchange confirmed last week that they will depart from the blue chip index together.

Shares have been badly hit due to a sharp downturn in the commodities markets, which Mr Nesis believes could take up to three years to correct. He is turning to formerly loyal shareholders in Moscow who rarely, if ever, dabble in the London markets, by again listing in the Russian capital.

Mr Nesis is also looking at expanding its platinum business. The centre of platinum mining is South Africa, but bloody union disputes have badly hit production in the past year.

He said: "I believe that South African platinum production will go the way of South African gold, which saw production halved in 10 years. I'm very positive on platinum, based on the supply disruptions from South Africa."

The group is also on the hunt for all-share deals worth up to $1bn (£639.5m) and has identified the mines and assets that it would like to own. Offers are likely to start being made in the final few months of the year, so Polymetal can be expected to have completed some major acquisitions in early 2014.

Evraz and Polymetal will be replaced in the FTSE 100 by housebuilder Persimmon and builders' merchant Travis Perkins. Persimmon has been out of the top index since the height of the crisis in 2008, when housebuilding was one of the worst struck industries.

But the housing market has improved, which has equally helped Travis Perkins, as homeowners snapped up DIY products in its Wickes chain.