Polyus Shareholders Head Off Potanin Bid for Stronger Hand

Shareholders in Polyus Gold elected on Monday to retain the firm's current board of directors and voting charter, thwarting an attempt by a co-owner to strengthen his hand in Russia's largest gold miner.

Vladimir Potanin, who is engaged in a protracted asset split with Polyus chairman Mikhail Prokhorov, failed to win enough votes in a shareholders' meeting that he called in a bid to amend a board structure that favors his ex-business partner.

The result increases the likelihood that Polyus will be able to spin off its exploration assets into a separate company with a view to a future share listing -- a strategy supported by Prokhorov but opposed by Potanin's Interros investment vehicle.

It also sets the scene for Tuesday's vote by shareholders in Norilsk Nickel, the other major miner owned by the two billionaires.

At Norilsk, the world's largest nickel miner, the situation is reversed: Prokhorov has called for the vote with the aim of re-electing a board where his Onexim group does not have a majority.

Polyus said in a statement that 72 percent of its shareholders took part in Monday's extraordinary general meeting. Only 58 percent voted to change the company's charter, falling short of the required 75 percent of those in attendance.

More than 96 percent of those who voted were against the early termination of the board members' powers, it said.

"The vote is an important endorsement of the current board of Polyus Gold and its strategy, and demonstrates the widespread support it enjoys from the shareholders," Polyus chief executive Yevgeny Ivanov said in the statement.