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Petropavlovsk appoints interim CEO after boardroom coup

City AM logo City AM 17/08/2020 Joe Curtis
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Under-fire gold miner Petropavlovsk appointed an interim chief executive today after an activist investor succeeded in blocking the reappointment of its former boss.

Maksim Meshcheriakov will also be a candidate for the permanent position after Pavel Mavlovskiy’s return was scuppered by 7.5 per cent shareholder Everest.

Read more: Activist investor Everest prevails in Petropavlovsk board battle

Founder of the Russia-focused miner Peter Hambro, and temporary CEO Alya Samokhvalova were also ousted in last week’s boardroom battle.

Meshcheriakov, a mining industry veteran of 17 years, joins James W Cameron – Petropavlovsk’s new chairman – and senior independent director Charlotte Philipps as another new face at the top of the FTSE 250 firm.

“The immediate priority of the board is to ensure the stability of the management of the business and its assets, and we are delighted with the appointment of Mr Meshcheriakov,” chairman James W Cameron said.

“Our next step is to provide a robust and transparent governance structure that will command the trust and support of all stakeholders.  In my new role as chairman, I am delighted to have the opportunity to begin that process so that we can return the internal and external focus to our strong asset base and operations.”

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Petropavlovsk’s share price rose 3.5 per cent to 32.65p in morning trading today.

The power struggle between Everest and other investors erupted in June, when former CEO Mavlovskiy and six other directors were voted out at a general meeting.

Last week shareholders also voted for an independent forensic investigation of related party transactions in the last three years.

The vote followed a turbulent few months for Petropavlovsk despite rising gold prices amid the coronavirus pandemic.

Rival investor Prosperity claimed Everest was attempting to take the miner private with majority stakeholder UGC, referring Everest to the Takeover Panel.

UGC denied the accusation in an interview with the Financial Times. And Everest then accused Prosperity of the same thing, in turn referring it to the Takeover Panel.

Read more: UGC owner denies trying to takeover Petropavlovsk ahead of crunch vote

In the aftermath of the initial general meeting in June, Prosperity referred Everest to the Takeover Panel, claiming it was acting in concert with other shareholders to take the miner private.

The scuffle led auditor PwC to refuse to sign off on Petropavlovsk’s accounts over concerns about its corporate governance.

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