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Former ambassador to Russia pushes for change at gold miner Petropavlovsk

The UK's former ambassador to Russia, Sir Roderic Lyne,..

The UK's former ambassador to Russia, Sir Roderic Lyne, has written to the chairman of embattled gold miner Petropavlovsk urging him to step down and reinstate the company's old board.

Lyne was part of the former board which was ousted by shareholders last year, after being accused of loading the company with debt and failing to produce any results for shareholders.

But in a strange twist, two mysterious investors who recently bought into Petropavlovsk have launched a requisition which aims to boot out all the current directors and reinstate Lyne, former chief executive Pavel Maslovskiy and ex-director Robert Jenkins.

Read more: Petropavlovsk shareholder tussle steps up as largest investor weighs in

"We believe that a change of leadership is essential, and that the best interests of the company would be served by the return of Pavel Maslovskiy as CEO," wrote Lyne to chairman Ian Ashby.

"We are also convinced that it would be best for the company and for all concerned if this change was achieved by the mutual consent of all sides and without public rancour."

Lyne added that he had met with the two shareholders – who go by the names Cabs and Slevin – who were pressing for his reinstatement, but he declined to reveal their identity.

One top Petropavlovsk shareholder told City A.M. that the two shareholders had bought their stakes from an entity controlled by Petropavlovsk's ejected co-founder Peter Hambro and Maslovskiy, and were likely to be closely connected to the two former executives.

Read more: Petropavlovsk loses key supporter as M&G sells its stake to mystery fund

However Lyne said he rejected any insinuation that the pair were "holding shares on behalf of undisclosed third parties".

He added that he was "puzzled" by the board's hesitance to put forward the requisition raised by Cabs and Slevin at Petropavlovsk's June AGM, since both were clearly shareholders who had a right to make such a request.

Kenges Rakishev, the Kazakh entrepreneur who is the company's largest shareholder, had given notice that his current plan is to back the resolutions from Cabs Platform and Slevin, despite formerly supporting the current board's strategy.

Petropavlovsk may also be in financial trouble as it warned last week that Hong Kong-listed IRC, an iron ore mining company which is 31 per cent owned by Petropavlovsk, might be about to default on its debt.

Petropavlovsk guaranteed the loan and if IRC does default, the gold miner may have to sump up $234m (£177m) to its Chinese lender.

Read more: Petropavlovsk warns it could have to stump up $234m as debt talks stall

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