CapeView Capital, a hedge fund backed by Goldman Sachs, has taken stake in Russian gold miner Petropavlovsk (LON:POG).
The move comes as Petropavlovsk, one of the highest profile casualties of the falling gold price, recently wrapped a refinancing plan to strengthen its balance sheet.
Led by Peter Hambro, the firm still operates as one of the three largest listed miners of Russian gold by annual volume, but has struggled with mounting debts and lower gold prices.
Today, CapeView, which is run by former Deutsche Bank trader, Theo Panos, said it had taken a 5.3% stake in Petropavlovsk.
The event-driven hedge fund focused on high yield and distressed debt is backed by a Goldman Sachs’ private equity fund.
Earlier this month, Petropavlovsk's shareholders supported a refinancing package for the miner, intended the keep the firm afloat.
The refinancing included a deeply discounted rights issue and a £100mln of new bonds.
However, the firm experienced a poor take up rate (30%) of its 3.1bn shares issued, leaving its underwriters with the remaining 2bn.
In any case, the refinancing package allowed the miner to stay in business, and focus on its targets for this year, which include producing 680,000-700,000oz of gold.