July 23 (Reuters) - A boardroom battle for control of Russian gold miner Petropavlovsk should not have an impact on the company’s performance and so far has not affected its operations, the group’s chief executive said on Thursday.
Petropavlovsk, which has a history of such conflicts is embroiled in another stand-off between a group of shareholders that voted out half of its directors last month, and the old board, which challenged the validity of the vote.
“There is no reason that any operations should be affected. The management at the moment, is still the same management which brought the company to success,” chief executive Alya Samokhvalova told Reuters.
Samokhvalova was appointed as one of four temporary directors by the old board, replacing co-founder and former CEO Pavel Maslovskiy who was ousted in June.
The management now focuses on running operations “as business as usual”, she said, adding it was difficult to tell what impact the conflict could have in the long run.
Samokhvalova was speaking after the miner reported a 42% increase in first-half total gold production to 320,600 ounces and confirmed its full-year target of 620,000 to 720,000 ounces.
The current stand-off pits four shareholders led by rival miner UGC owned by Russian billionaire Konstantin Strukov against the board backed by asset manager Prosperity Capital Management, which is the miner’s second biggest shareholder.
Peel Hunt analysts say at the heart of the conflict is Petropavlovsk’s pressure oxidisation (POX) hub that can process refractory ore and which has started producing gold in 2019.
Samokhvalova would not comment on the conflict’s origins, but said the hub put Petropavlovsk in a leading position among Russian miners and it was essential that its operations remained unaffected.
“To lose this position because of some board conflict would be a really great shame,” she said. (Reporting by Anna Rzhevkina, additional reporting by Zandi Shabalala Editing by Tomasz Janowski)