AMC has an “Answer Team” team to respond to questions submitted to our web address of info@amurminerals.com. Our team’s intent is to provide shareholders with accurate and factual information. Price sensitive questions cannot be addressed in this forum in accordance with LSE regulatory constraints. Such information will be provided in an RNS.
“How big are the bonuses for the Directors for selling Kun-Manie”
Answer Team: There are no bonuses being paid to any of the Directors or staff. Dividends equal to that paid to the shareholders will be paid to the Directors and staff.
“Can’t Bering buy shares in the market to control the approval of the sale?”
Answer Team: No, as part of our agreements, the buyer is not allowed to buy shares in the market.
“With Kun-Manie being in Russia and given the sanctions, are there ramifications to the company being listed in London?”
Answer Team: Yes, Directors & Officer insurance will increase substantially as long as we hold assets in Russia. We will likely have to find a new auditor as BDO has informed all of its clients that hold Russian assets they will no longer undertake work with companies holding assets in Russia. Completion of the sale will allow for reduced insurance costs and we will be able to maintain the long term relationship with BDO.
“There will be another deal if this gets turned down.”
Answer Team: Interesting. Extremely unlikely and nothing on the table now given the sanctions eliminating all foreign entities. As for a Russian company, many are sanctioned and Russian banks as well. Sanctions and Executive Orders are being continually increased and adjusted tightening western companies ability to operate in Russia.
“Can we be nationalized?”
Answer Team: Absolutely. Obviously, all value attributable to the project is lost if that should occur.
“Does the Strategic class still hold? What has to be done to be removed from this?”
Answer Team: The Kun-Manie project has Russian certified reserves for nickel, cobalt and the platinum group metals. Any Russian certified reserve related to these commodities automatically places a project (no matter who owns it) into the Strategic category. It is extremely unlikely any project can be removed from this list.
Being strategic means any sale or ownership transaction wherein more than 25% of the holding with or to a foreign entity must be approved in advance of completion of the transaction by the Anti-Monopoly Board. So with regard to the Strategic Law, the ability to sell Kun-Manie partially or in its entirety (100% controlled by AMC) has been limited to unsanctioned Russian entities.
“Great job, spent 100 million GBP and get back 35 million GBP.”
Answer Team: This is inaccurate, actual sunk costs into Russia are in the order of 32 million USD, 35 million USD planned payment.
“What is the timing on receiving the payment from Bering for the sale of Kun-Manie?”
Answer Team: Barring any further and unforeseen sanctions or orders or changes, the schedule is per the following information provided in the Circular. The Share purchase agreement was signed 4 August. Shareholder vote is on 24 August. With a 90 day completion period from signing of the purchase agreement, the 90th day is 2 November. Payment is required within 5 days so cash in circa 9 November. Dividend no later than 90 days after delivery of the funds to the company.
“I saw two news items in The Telegraph, I would like to know if either of these impact Amur. One was under the “Russian firms banned from foreign stock markets” and the second was “UK shuns Moscow Stock Exchange.”
Answer Team: Both articles (published 19 April 2022) to which you refer are from The Telegraph and can be found under the link, https://www.telegraph.co.uk/business/2022/04/19/ftse-100-markets-live-news-energy-oil-gas-economy/.
Neither impact Amur. The first is a restriction to be imposed by Russia on companies that are registered in Russia and have depositary receipts traded on stock exchanges outside of Russia. Amur is British Virgin Islands domiciled and therefore not impacted by this restriction.
The second article has to do with the status of the Moscow Stock Exchange (“MOEX”). A recognized stock exchange status is a classification given by HMRC for purposes, on application, to qualifying stock exchanges. Securities traded on a recognised stock exchange are eligible for certain tax treatments and reliefs. The HMRC proposal to remove the MOEX’s recognised stock exchange status, limits access to certain UK treatments and reliefs for future investments in securities traded on MOEX. As Amur is not traded on the MOEX, it is not affected by the proposed change.
For completeness, copies of the two articles are provided below.
“Russian firms banned from foreign stock markets”
The Russian Federation has formally banned Russian firms from listing on foreign stock exchanges, marking a fresh blow to the country’s tycoons.
The Russian leader has signed off on legal amendments that require companies to delist their overseas shares, marking an end to a process that has gathered pace since the annexation of Crimea in 2014.
The new laws could force oligarchs such as Russia’s richest man Vladimir Potanin and steel billionaires Vladimir Lisin and Alexey Mordoshov to overhaul the ownership structure of their businesses.
The move also cements Russia’s status as a pariah from the global financial system even further. Foreign listings have slowed in recent years, while Russian companies have seen their shares crash in the wake of sanctions and boycotts.
“UK shuns Moscow Stock Exchange”
The UK is revoking the Moscow Stock Exchange’s status as a recognised stock exchange in the latest sign of Russia’s isolation from the global financial system.
The move, announced by HM Revenue & Customs, means new investors will not be able to access certain UK tax benefits in future when trading securities in Moscow, although existing investments will be protected.
It is the latest effort to discourage investments in Russia, whose economy is on its knees in the wake of sweeping western sanctions.
The move comes after Moscow banned foreign investors from pulling their investments in Russian stocks amid a string of emergency measures designed to stave off a market collapse.
The Government said the ban meant the Moscow exchange was “no longer operating in line with the normal commercial standards expected of a recognised exchange”.