said April 29 that ithas secured deals to sell two noncore assets for a total of US$20 million, whichwill be used to reduce the group's net debt and for general working capital.
The company'swholly owned Horatio Ltd. unit has signed a share purchase agreement for the saleof a 100% interest in OOO Ilyinskoye, which owns the mining license over the gold deposit in Russia,to AO Yuzhuralzoloto Group of Companies.
In addition, Petropavlovskentered into an agreement to sell its 49% interest in ZAO VerkhnetisskayaOre Mining Co. to an entity associated with the Yuzhuralzoloto Group, which is saidto be one of the largest Russian gold miners.
In accordancewith the Ilyinskoye deal, the buyer must pay Petropavlovsk US$7.5 million by May15. Petropavlovsk will also be entitled to a US$9 million receivable as considerationfor the assignment of a certain loan, payable in tranches by July 30.
Meanwhile, Petropavlovskwill receive US$500,000 for its shares in Verkhnetisskaya, with a further US$3 millionreceivable as consideration for the assignment of a certain loan, payable by June10.
According toPetropavlovsk Chairman Peter Hambro, the disposal of the noncore assets is in linewith the group's strategy of debt reduction and shifting focus on the company'score producing assets.
Petropavlovsknarrowed its 2015 attributablenet loss to US$241.9 million, while net debt totaled US$610.0 million at the endof the year. The company expects stagnant or slightly less gold production in 2016.