Petropavlovsk, the gold producer rocked by a series of boardroom battles and shareholder feuds, has turned to a Russian rival for its new chief executive.
The FTSE 250 miner said on Monday that Denis Alexandrov, who resigned from Highland Gold last week, would take the helm of the company from Tuesday.
The appointment of Mr Alexandrov comes as Petropavlovsk tries to draw the line under a summer of bitter infighting and disputes that have made the company uninvestable for some big institutional investors in London.
Petropavlovsk in effect launched the search for a new chief in June after a group of shareholders led by UGC, another Russian gold producer, ousted the company’s co-founder Pavel Maslovskiy and half of its board.
The miner was established in 1994 by Mr Maslovskiy and Peter Hambro, a scion of the London banking dynasty. It is one of the biggest UK-listed gold companies with production of 560,000 to 600,000 ounces expected this year.
The removal of Mr Maslovskiy has caused a bitter internal conflict at Petropavlovsk that has pitched employees loyal to the previous management against the new board, chaired by James Cameron, and management team.
The company revealed last month that a lack of co-operation among some employees had resulted in delays in receiving cash from some of its Russian subsidiaries.
Its interim chief, Maxim Meshcheryakov — who will remain with the company in a senior position to work with Mr Alexandrov — also had to force his way into the company’s Moscow headquarters in August after a stand-off with local staff.
Industry experts said Mr Alexandrov was an “outstanding” hire but faced a tough task bringing together the warring factions at Petropavlovsk.
“Having worked with Denis over the past few years, I think this is an outstanding hire for Petropavlovsk,” said Canaccord Genuity. “Concerns around the lack of transparency to the business will still likely weigh on investor sentiment, but this hire should be viewed very positively.”
Mr Alexandrov resigned from Highland Gold last week after almost four years at the helm of its operating arm, Russdragmet.
Highland Gold is to be taken private after Chelsea Football Club owner Roman Abramovich sold his 40 per cent stake in the company to Vladislav Sviblov, a Russian businessman with a number of mining assets.
Mr Alexandrov said his first priorities would be to ensure a “smooth transition” to the new leadership team and to formulate a “clear operating strategy”.
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“In the current gold price environment, better management of the group’s strong asset base should benefit all of our stakeholders,” he said.
Since an attempt to reinstate Mr Maslovskiy was voted down by shareholders in August, Petropavlovsk has been trying to simplify its complex organisational structure, which includes 30 subsidiaries.
However, attempts to reverse changes made by Mr Maslovskiy to the constitution of several Russian subsidiaries have faced legal challenges in Russia from employees and the ex-chief’s son Alexey Maslovskiy.
The company’s former deputy chief executive, Alya Samokhvalova, is also suing the company for unfair dismissal, claiming she was fired for whistleblowing.
Petropavlovsk denies the claim and says her dismissal was for signing off the changes to the constitutional documents.
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