Home Business Advisers to London-listed gold miner Petropavlovsk stop as Russian sanctions chew

Advisers to London-listed gold miner Petropavlovsk stop as Russian sanctions chew

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Advisers to London-listed gold miner Petropavlovsk stop as Russian sanctions chew

A restructuring agency drafted in only a month in the past to advise the London-listed gold miner Petropavlovsk has resigned from the position because the increasing scope of Russia-related sanctions hits elements of the City’s skilled companies sector.

Sky News has learnt that AlixPartners, which is predicated within the US, stepped again from its position with the gold producer earlier this month following the imposition of recent restrictions on the work that administration consultants and accountants can undertake for Russian firms within the wake of its struggle in Ukraine.

City sources mentioned on Friday that BDO, the British-based accountancy agency, had since stepped in to exchange AlixPartners as Petropavlovsk’s restructuring adviser.

Although neither the gold producer nor its executives have been sanctioned by the UK authorities, BDO’s resolution to simply accept the work might however immediate shock within the City.

Earlier this month, Liz Truss, the overseas secretary, introduced a ban on the export of companies together with administration consulting, accountancy work and public relations.

“Doing business with Putin’s regime is morally bankrupt and helps fund a war machine that is causing untold suffering across Ukraine,” she mentioned.

“Cutting Russia’s access to British services will put more pressure on the Kremlin and ultimately help ensure Putin fails in Ukraine.”

Kwasi Kwarteng, the enterprise secretary, added: “Our professional services exports are extraordinarily valuable to many countries, which is exactly why we’re locking Russia out.

“By limiting Russia’s entry to our world-class administration consultants, accountants and PR companies, we’re ratcheting up financial stress on the Kremlin to alter course.”

AlixPartners’ mandate was revealed by Sky News at the beginning of April and confirmed by the company in a stock exchange announcement a fortnight later.

Petropavlovsk was hit last month by a demand from Gazprombank, its main lender, for a debt repayment of nearly $300m.

“The firm has appointed AlixPartners UK LLP to help the board because it explores its choices and determines the corporate’s plan of action in one of the best curiosity of all stakeholders, together with collectors and shareholders,” Petropavlovsk said last month.

“These choices embrace the sale of the corporate’s whole pursuits in its working subsidiaries as quickly as virtually potential.

“It is not currently clear what return, if any, may be secured for shareholders or the holders of the bonds or notes as a result of this process.”

Petropavlovsk, which mines gold within the far east of Russia, mentioned in March that it had been prohibited from making a mortgage curiosity fee of $560,000 as a result of Gazprombank had been sanctioned by the UK authorities.

The firm has seen its shares plunge to simply 1.49p, leaving it with a market worth of solely £56m.

The inventory has fallen by over 90% within the final 12 months.

In latest years, Petropavlovsk has been embroiled in a collection of rows involving administration and shareholders.

An organization spokesman mentioned: “Petropavlovsk is a UK plc and the company is not currently under any sanctions.”

AlixPartners declined to remark.

A BDO spokesperson mentioned: “We do not comment on whether companies are clients or not”.

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