Polymetal International Plc, a Russian gold and silver producer in London’s FTSE-100 index, sees zero chance of a merger with Polyus Gold Ltd. as the trend for large combinations in the industry is over.
“The era of megadeals driven by the management egos is gone,” Chief Executive Officer Vitaly Nesis said today in an interview with Bloomberg Television’s Francine Lacqua. “My estimate of the likelihood of such a deal is zero.” Polymetal would rather focus on internal growth and dividends, he said.
Polymetal owners including Alexander Nesis, the CEO’s older brother, had held talks with Polyus shareholders on a possible merger since 2011, people with the knowledge of the matter said in September. The two companies’ views differ on some strategic issues, Polymetal Deputy CEO Pavel Danilin said in a phone interview today, adding that there are no talks now. Sergey Lavrinenko, a Polyus spokesman, declined to comment.
“I don’t see the industrial logic behind such a merger,” CEO Nesis said in today’s television interview. “I don’t think that the market would react positively.”
Polymetal increased net income almost 40 percent last year to $401 million. It today announced a 2012 dividend of $119 million on top of a $191 million special dividend declared in December. The company will consider paying a special dividend at the end of this year, too, Nesis said.