OREANDA-NEWS. Polymetal International plc has agreed to settle the Kyzyl put option for a net consideration of USD 68 million. The Polymetal shares subject to the put option arrangement will be simultaneously transferred from Sumeru Gold B.V. to financial group Otkritie.

Under the terms of the acquisition of Altynalmas Gold Ltd. (the holding company for the Kyzyl gold project in Kazakhstan), Sumeru Gold B.V. (the "Seller" or "Sumeru"), received, along with other consideration, US\\$300 million payable through the issue to of 31,347,078 new ordinary shares of the Company (the "Consideration Shares"). The share price used to determine the number of Consideration Shares issued was US\\$9.57 per share (the unweighted mean average closing price of Polymetal shares on the London Stock Exchange in the twelve calendar months ending three trading days before Completion).

Sumeru also received a put option, giving Sumeru the right, at their sole discretion, to require Polymetal to acquire or procure acquirers for the Consideration Shares during the one-month period commencing 4 September 2015 at a price per Consideration Share equal to US\\$9.57. Sumeru has exercised this right to require the acquisition of the Consideration Shares.

The Company has agreed to the following settlement mechanism for the put option:
* Polymetal will settle the full contractual put option liability to the Seller and deliver a cash payment in the amount of USD 300 million;
* Simultaneously, Polymetal will transfer the right to receive Consideration Shares to Otkritie Investments Cyprus Limited ("Otkritie"), which is part of financial group Otkritie, in exchange for a cash consideration of USD 232 million. The cash consideration payable by Otkritie to Polymetal represents the average closing price of the Polymetal shares for the agreed quotation period being one month ended five business days before the date of signing the assignment agreement, which was USD 7.41 per share ("Reference Price"), multiplied by the number of Consideration Shares.

The net amount of USD 68 million payable by Polymetal represents the difference between the strike price of USD 9.57 per share and the Reference Price of USD 7.41 per share, multiplied by the number of Consideration Shares. The effect of the above transactions for the Company will be equivalent to the net settlement of the put option liability using the Reference Price.

As a result, Sumeru will cease to be the shareholder of the Company and Otkritie will become the owner of 31,347,078 shares (7.40% of the total issued share capital of Polymetal). It is expected that the transfer of shares from the Seller to Otkritie will not have any impact on the free float of the Company and will not affect the total number of shares in issue. Otkritie Group has agreed not to dispose of any interest in 90% of the Consideration Shares during a lock-up period of six months subject to customary terms and exclusions.