The co-founder and former chief executive of Petropavlovsk has criticised an investigation launched by the London-listed Russian gold miner into past deals as a “smokescreen”.
Pavel Maslovskiy said he viewed the examination of related party transactions undertaken during his tenure as an attempt to distract attention from its biggest shareholder, Russian rival UGC.
Mr Maslovskiy has accused UGC of trying to take control of the company without paying a takeover premium. He has asked regulators in the UK and Russia to investigate.
“Everything else around this is a smokescreen to cover up in reality what is really going on,” Mr Maslovskiy told the Financial Times.
UGC has always denied Mr Maslovskiy’s claims and Konstantin Strukov, its billionaire owner, has said he has no interest in acquiring the company.
Petropavlovsk, a FTSE 250 company with a market value of £1.2bn, was founded in 1994 with Peter Hambro, a scion of the London banking dynasty.
The company’s shares have risen 135 per cent this year as it began to reap the rewards of a new processing plant that allows it to produce gold from refractory ore, which is hard to process.
At the start of the year UGC bought a 24 per cent stake in Petropavlovsk, plunging the company, which has been rocked by a series of corporate feuds in recent years, into fresh boardroom turmoil. It voted in June along with three other shareholders to oust Mr Maslovskiy and half of Petropavlovsk’s board.
It then voted against an attempt to reinstate Mr Maslovskiy in August and supported a resolution put forward by Everest Alliance, an investment vehicle represented by Russian businessman Nikolai Lioustiger, calling for an independent investigation of related-party transactions carried out by the company over the past three years.
Last month Petropavlovsk appointed KPMG to oversee the investigation, which covers a three-year period to August 2020. Its new chairman James Cameron told shareholders he would expose any “historic instances of failed corporate governance” and recover “any misappropriated funds or assets”.
Mr Maslovskiy said he had nothing to fear. “From the previous management point of view and the current management on the ground we are absolutely comfortable with this,” he said.
One deal that has come under scrutiny — a plan to buy out the shares that Petropavlovsk did not already own in the Temi gold project in Russia’s far east — had already been investigated, he added.
“There was a rumour that I was connected to, or a beneficiary of, the deal,” Mr Maslovskiy said. “That matter was specifically investigated . . . and it was confirmed there was absolutely no truth.”
Mr Maslovskiy also noted that Mr Cameron had joined Petropavlovsk’s board in October 2018 and was a member of its audit committee.
“If there are so-called dodgy deals . . . they were in the presence of Mr Cameron who is now chairman,” he said.
Mr Maslovskiy also hit back at claims that he had orchestrated a campaign of disobedience by Petropavlovsk staff in Russia.
The company says it has encountered a lack of co-operation from some employees and ex-employees in a number of its Russian subsidiaries, leading to delays in receiving cash.
Mr Maslovskiy said employees in Russia were “very unhappy” about the recent boardroom turmoil and some managers were looking to “pack their bags and leave” if the UK Takeover Panel or Russia’s antitrust regulators did not take action.
“There are actions that can be taken [by regulators] . . . to force the concert party to sell its stake or make an offer,” he said, adding: “If you want control, pay for the control at a fair price.”
UGC has always denied working with other Petropavlovsk shareholders, including Everest Alliance, to remove directors.
Mr Maslovskiy confirmed he had discussed the idea of merging Petropavlovsk and UGC with Mr Strukov shortly after the billionaire purchased his stake in February.
However, it quickly became apparent that a deal would not work because UGC was a “private company and not very transparent”, according to Mr Maslovskiy.
He said he was now worried Mr Strukov would put pressure on Petropavlovsk to increase borrowing either to fund acquisitions or return cash to shareholders.
UGC declined to comment.
Petropavlovsk said the investigation into related-party transactions was the result of an instruction passed by 84 per cent of shareholders at a general meeting and was entirely consistent with the drive for improved transparency.
“As previously announced, the company has encountered a lack of co-operation from certain employees as well as legal action, in which Pavel Maslovskiy and his son Alexey are directly involved,” it said. “This legal action is without merit and disruptive to the business.”
This article has been updated to show that Everest Alliance put forward shareholder resolutions rather than Nikolai Lioustiger