Kinross announces sale of Russian assets
April 05 2022 - 5:57AM
Kinross Gold Corporation (TSX:K; NYSE:KGC) (“Kinross”) announced
today that it has entered into a definitive agreement (“Agreement”)
with the Highland Gold Mining group of companies (“Highland Gold”)
and its affiliates to sell 100% of its Russian assets for total
consideration of $680 million in cash.
As part of the transaction, Kinross will receive
a total of $400 million in cash for the Kupol mine and the
surrounding exploration licenses, which includes payment of $100
million upon closing, as well as additional payments of $150
million before the end of 2023, $100 million before the end of
2024, and $50 million before the end of 2025. Kinross will also
receive a total of $280 million in cash for its Udinsk project,
which includes payments of $80 million before the end of 2025, $100
million before the end of 2026, and $100 million before the end of
2027.
The deferred payments are secured by an
extensive security package that includes share pledges, financial
guarantees and an escrow account. All payments under the Agreement
are payable in U.S. dollars.
Highland Gold is one of the largest gold mining
companies in Russia and operates several mines in the country,
including in the Chukotka and Khabarovsk regions where the Kupol
mine and Udinsk project are located, respectively.
The transaction is subject to the approval of
the Russian government and the finalization of certain ancillary
agreements.
About Kinross Gold Corporation
Kinross is a Canadian-based senior gold mining
company with mines and projects in the United States, Brazil,
Russia, Mauritania, Chile, Ghana and Canada. Our focus is on
delivering value based on the core principles of operational
excellence, balance sheet strength, disciplined growth and
responsible mining. Kinross maintains listings on the Toronto Stock
Exchange (symbol:K) and the New York Stock Exchange
(symbol:KGC).
Media Contact Louie DiazVice-President,
Corporate Communicationsphone:
416-369-6469louie.diaz@kinross.com
Investor Relations ContactChris
Lichtenheldt Vice-President, Investor
Relations phone:
416-365-2761 chris.lichtenheldt@kinross.com
Cautionary statements on forward-looking
information
All statements, other than statements of
historical fact, contained in this news release, including any
information as to the future financial or operating performance of
Kinross, constitute “forward-looking information” or
“forward-looking statements” within the meaning of certain
securities laws, including the provisions of the Securities Act
(Ontario) and the “safe harbor” provisions under the United States
Private Securities Litigation Reform Act of 1995 and are based on
the expectations, estimates and projections of management as of the
date of this news release, unless otherwise stated. Forward-looking
statements contained in this presentation include, without
limitation, statements with respect to the completion and timing of
the sale of its Russian assets; the schedule of payments in secured
instalments over the next five years; and projected timing of
Russian government approvals. Phrases or statements that certain
actions, events or results may, could, should or will be achieved,
received or taken, or will occur or result and similar such
expressions identify forward-looking statements. Forward-looking
statements are, necessarily, based upon a number of estimates and
assumptions that, while considered reasonable by Kinross as of the
date of such statements, are inherently subject to significant
business, economic and competitive uncertainties and contingencies.
The estimates and assumptions of Kinross contained in this news
release, which may prove to be incorrect, include, but are not
limited to: (i) that the parties will complete the acquisition in
accordance with, and on the timeline contemplated by, the terms and
conditions of the relevant agreements, on a basis consistent with
our expectations; (ii) that, in the event any deferred payment is
not paid to Kinross, the security package, including share pledges,
financial guarantees and an escrow account, will be realized and
enforceable in a manner consistent with the Company’s expectations;
(iii) that economic and sectoral sanctions (or similar laws) will
not adversely impact the transaction or the parties’ ability to
discharge their obligations under the transaction agreements,
including payment of the purchase price; and (iv) that the
necessary approvals from the applicable Russian government
authorities will be obtained in a timely manner, or at all. There
can be no assurance that forward-looking statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements, including the
risk that the sale transaction will not be completed for any reason
and that the secured installment payments are actually paid to
Kinross. Forward-looking statements are provided for the purpose of
providing information about management’s expectations and plans
relating to the future. All of the forward-looking statements made
in this news release are qualified by this cautionary statement and
those made in our other filings with the securities regulators of
Canada and the United States including, but not limited to, the
cautionary statements made in the “Risk Analysis” section of our
MD&A for the year ended December 31, 2021 and the Annual
Information Form dated March 31, 2022. These factors are not
intended to represent a complete list of the factors that could
affect Kinross. Kinross disclaims any intention or obligation to
update or revise any forward-looking statements or to explain any
material difference between subsequent actual events and such
forward-looking statements, except to the extent required by
applicable law.
Source: Kinross Gold Corporation
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