Kinross plans to divest its Russian assets

Rhea-AI Summary

Kinross Gold Corporation announced a transition plan to divest its Russian assets following the ongoing geopolitical situation. Currently, the company is in exclusive negotiations with a third-party mining firm to sell 100% of its Russian operations, pending government approval. Despite the ongoing operations to maintain assets, the parent company will not receive financial benefit during this transition. Kinross plans to treat these assets as held for sale from an accounting viewpoint until the sale is finalized, and will provide updates to its guidance as necessary.

Positive

• Kinross is in exclusive negotiations to divest 100% of its Russian assets, which may improve focus on core operations.
• The transition plan aims to maintain asset management and environmental compliance during the divestment process.

Negative

• The parent company will not benefit financially from Russian operations during the transition period.
• Any potential sale is contingent on Russian government approval, introducing uncertainty.

TORONTO, March 29, 2022 (GLOBE NEWSWIRE) -- Kinross Gold Corporation (TSX:K; NYSE:KGC) (“Kinross” and the “Company”) today provided an update regarding its activities in Russia.

Subsequent to Kinross’ disclosure on March 2, 2022, the Company has been developing a transition plan to divest its Russian assets. Kinross has received a number of unsolicited proposals regarding its Russian business and is now in exclusive negotiations with a third-party mining company regarding a potential sale of 100% of its assets in the country. Any such divesture or change of control would be subject to Russian government approval.

As part of the exclusivity agreement and to properly maintain assets pending a change of control, the Company’s Russian subsidiaries are continuing to operate during the transition period. Kinross will also continue to manage and mitigate the environmental impacts of its operations. This includes overseeing monitoring systems and transporting industrial materials to the Kupol mine that are not permitted to remain at the port to maintain safety and regulatory compliance. Kinross will continue to prioritize the well-being of its more than 2,000 employees in the country as it develops its transition plan.

The parent company will not benefit financially from the operations while the transition plan is finalized. Current activities will be funded through resources already in-country, with no additional investment required by the parent company.

Kinross expects to treat its Russian business as an asset held for sale from an accounting perspective until a change of control is completed. The Company will provide updates to its guidance at the appropriate time.

About Kinross Gold Corporation

Kinross is a Canadian-based senior gold mining company with mines and projects in the United States, Brazil, Russia, Mauritania, Chile, Ghana and Canada. Our focus is on delivering value based on the core principles of operational excellence, balance sheet strength, disciplined growth and responsible mining. Kinross maintains listings on the Toronto Stock Exchange (symbol:K) and the New York Stock Exchange (symbol:KGC).

Media Contact
Louie Diaz
Vice-President, Corporate Communications
phone: 416-369-6469
louie.diaz@kinross.com

Investor Relations Contact
Chris Lichtenheldt
Vice-President, Investor Relations
phone: 416-365-2761
chris.lichtenheldt@kinross.com

Cautionary statements on forward-looking information

All statements, other than statements of historical fact, contained in this news release, including any information as to the future financial or operating performance of Kinross, constitute “forward-looking information” or “forward-looking statements” within the meaning of certain securities laws, including the provisions of the Securities Act (Ontario) and the “safe harbor” provisions under the United States Private Securities Litigation Reform Act of 1995 and are based on the expectations, estimates and projections of management as of the date of this news release, unless otherwise stated. Forward-looking statements contained in this news release include, without limitation, statements with respect to the development and timing of the Company’s transition plan its Russian business; the Company’s ability to pursue and successfully implement a sale or transfer of its Russian business; the Company’s ability to safeguard the environment and the maintain the assets during the transition plan; the Company’s ability to temporarily continue operating its Russian activities (including its ability to comply with all applicable laws and sanctions); the ability of the Russian business to fund ongoing operations without additional capital injections; the Company’s anticipated accounting treatment of its Russian business; and the estimated economic impact to Kinross while the transition plan is being finalized. The words “estimate”, “expects”, “outlook”, or “plan” or variations of or similar such words and phrases or statements that certain actions, events or results may, could, should or will be achieved, received or taken, or will occur or result and similar such expressions identify forward-looking statements. Many uncertainties and contingencies can directly or indirectly affect, and could cause, Kinross’ actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Kinross, including but not limited to resulting in an impairment charge on goodwill and/or assets. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are provided for the purpose of providing information about management’s expectations and plans relating to the future. All of the forward-looking statements made in this news release are qualified by this cautionary statement and those made in our other filings with the securities regulators of Canada and the United States including, but not limited to, the cautionary statements made in the “Risk Analysis” section of our MD&A for the year ended December 31, 2021 and the Annual Information Form dated March 30, 2021. These factors are not intended to represent a complete list of the factors that could affect Kinross. Kinross disclaims any intention or obligation to update or revise any forward-looking statements or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law.

Source: Kinross Gold Corporation

FAQ

What is Kinross Gold Corporation's plan for its Russian assets?

Kinross plans to divest its Russian assets and is currently negotiating a sale with a third-party mining company.

What is the status of Kinross Gold's operations in Russia?

Kinross's Russian subsidiaries continue to operate during the transition, but the parent company will not receive financial benefits from these operations.

When will Kinross Gold provide updates on its Russian business?

Kinross will provide updates to its guidance at the appropriate time as the transition plan develops.

What challenges does Kinross face with its Russian business divestment?

The sale of its Russian assets is subject to approval from the Russian government, which adds a level of uncertainty.

How does Kinross plan to manage environmental impacts during the transition?

Kinross is overseeing monitoring systems and ensuring regulatory compliance to mitigate environmental impacts while managing its Russian operations.