Eurasia Mining

By William Turvill

EAU211

Company Review Update

The future of Russia-focused Eurasia Mining is shrouded in mystery after the Aim company last week suspended trading in its shares following a vast stock rally. 

Announcing the share suspension, Eurasia noted that it has been the subject of “social media speculation”. The company said shares would be suspended “pending clarification of its relationship with” a Chinese investment bank. 

The cryptic nature of the RNS has left investors, analysts and journalists guessing about what will happen next. 

Here is what we currently know…

What is Eurasia Mining?

Founded and listed on Aim in 1996, Eurasia is a Russia-focused miner with expertise in platinum, palladium, iridium, rhodium, and gold. 

It is headed up by executive chairman and managing director Christian Schaffalitzky, who has 40 years of experience in mineral exploration and also chairs Kibo Mining.

The leadership also includes commodities trading veteran Dmitry Suschov, who is a non-executive director, and mining M&A banker Alexei Churakov, a strategic advisor to the board.

The company’s share price was meandering along at around 0.5p for years until a rapid rise in late 2019.

What has happened in recent months?

Eurasia announced in October that CITIC – a Beijing-based, state-owned investment bank formerly known as  the China International Trust Investment Corporation – and VTB Capital, one of Russia’s largest investment banks, were assisting the company with “strategic options” for its Kola and Urals mining assets, which could both be sold. 

The firm’s share price shot up from below 0.5p to nearly 3p following the announcement. 

Christian Schaffalitzky, Eurasia’s chairman, said at the time: “The board is pleased that major banks such as CITIC and VTB Capital, the largest investment banks in China and Russia respectively, are interested in Eurasia’s PGM deposits including the ones in Kola.”

Dmitry Suschov, one of Eurasia’s non-executive directors, also spoke to Proactive Investors about the announcement: https://youtu.be/d_YMY6yiMDE.

In late November, Eurasia clarified its relationship with CITIC and VTB, explaining that while the company was continuing to work with the banks, there had been no engagement letter signed. The firm also said that no agreement on success fees had been agreed and reiterated that there was no certainty of a deal going through.

Despite no further announcements being made about the sale process, Eurasia’s shares have gone from strength to strength this year, leaping from below 4p at the end of January to 7.2p last week, when trading was suspended.

Announcing the suspension, Eurasia told the market:

“The company confirms that, following social media speculation, trading in its ordinary shares has been suspended (at 7.45am today) pending clarification of its relationship with CITIC. 

“The Company’s Aim securities remain suspended. Further updates will be made shortly.”

What is going on?

The buoyant shares – which may also have been boosted by rising platinum and palladium prices – and suspension might suggest a sale for Eurasia’s assets is close. 

But in truth, the cryptic nature of last week’s stock market announcement, and a reference to unspecified “social media speculation”, leaves a lot to be explained.

In response to last week’s announcement, the Armchair Trader questioned whether a sale may be getting close. The website noted that “Chinese investors remain very interested in Russian mining plays, particularly any which can provide a strategic source of precious and rare earth metals required for next-generation industrial needs”.

In October Eurasia Mining’s Dmitry Suschov discusses ‘strategic options’ for its mining assets, the SP was 2.5p
The author was remunerated but does not hold shares in the company 


Categories: Media