#Kazakhstan #Astana #Verny Capital #RG Gold #Zijin Mining

Verny Capital Completes Sale of RG Gold

In a pivotal move for Kazakhstan's mining sector, Verny Capital Group has finalized an agreement to sell RG Gold, a prominent gold mining company it has been managing since 2014. This transition underscores a decade of strategic growth, investment, and modernization undertaken by Verny Capital to enhance RG Gold's production capabilities and overall operational efficiency.

A Decade of Transformation

Over the past ten years, Verny Capital has worked diligently to elevate RG Gold from a modest mining operation into one of Kazakhstan's most significant gold producers. Under Verny's stewardship, RG Gold launched several modernization initiatives that included setting up advanced production infrastructure and heavily investing in new equipment and geological exploration. The result of these efforts has been a remarkable tripling of RG Gold's resource base, currently standing at 7.6 million ounces of gold, as verified by the JORC standards.

Since 2018, Verny Capital's collaboration with the U.S.-based private equity firm, Resource Capital Funds (RCF), has played a crucial role in this growth. Together, they expanded the company's production capabilities using cutting-edge technology. This has not only improved operational effectiveness but also ensured greater safety for the workforce while keeping production costs low.

The Sale Agreement

The agreement to sell RG Gold has been signed with Zijin Gold International, a subsidiary of Zijin Mining Group Co. Ltd. Zijin Mining is recognized as one of the world's largest mining corporations, focusing on gold and non-ferrous metal extraction. With a market capitalization approximating USD 70 billion, Zijin boasts an impressive portfolio of over 30 projects across 17 countries. The company is known for its commitment to sustainable growth, environmental stewardship, and innovative practices.

By entering the Kazakh market, Zijin aims to implement global best practices that will not only foster economic development in Kazakhstan but also create thousands of jobs in the sector. This strategic acquisition is expected to drive further innovation and efficiency in the mining industry.

Expert Guidance for a Smooth Transition

In facilitating this sale, Verny Capital and RCF received advice from top-tier investment banks, including J.P. Morgan Securities plc and BMO Capital Markets, alongside leading law firm Herbert Smith Freehills. Aidan Akanov, CEO of Verny Capital Group, expressed pride in having transformed RG Gold into one of the nation’s leading gold producers. He stated, “We are excited to pass on this success story to an international player with a solid track record in managing mining assets.”

Furthermore, he indicated that Verny Capital is actively exploring new investment opportunities within Kazakhstan, asserting confidence in the region's potential for high-performing projects.

Significant Contributions to the Economy

Beyond its operational achievements, RG Gold has emerged as a substantial contributor to Kazakhstan's economy. Over the years, it has become one of the largest taxpayers in the country, contributing over 160 billion tenge to the national budget. Additionally, RG Gold has created around 1,200 jobs and has consistently engaged in various social initiatives aimed at benefiting local communities, enhancing infrastructure, and improving living standards in the surrounding areas.

Martin Valdes, a partner at RCF, expressed gratitude towards Verny Capital for their partnership in successfully growing RG Gold. He emphasized the pride in being part of the development journey of this major production facility in Kazakhstan and welcomed Zijin Mining Group's entry, reinforcing Kazakhstan's position as a long-term investment-friendly destination.

Looking Ahead

As Verny Capital transitions RG Gold to Zijin, this sale not only represents a shift in ownership but also marks a significant milestone for the growth and development of Kazakhstan's mining industry. With continued investments and innovations, the region is poised to further leverage its rich mineral resources, benefitting both local communities and the investors involved. The collaboration paves the way for a promising future in Kazakhstan's mining sector, aligning it closer to global standards of operation and sustainability.