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Moscow bourse stops trading in Uzhuralzoloto after state demands ownership stake

The central bank of Russia has ordered that the Moscow Exchange suspend trading in shares owned by gold producer Uzhuralzoloto.

A Russian court announced on Thursday that the Prosecutor-General had filed a suit to transfer ownership of shares held by Konstantin Strukov, an investor in Uzhuralzoloto, to the government. This is part of a escalation this year of the seizures of assets domestically through Russian courts.

In a Friday statement, UGC stated that it was in constant contact with the Central Bank and that its "priority is to protect our minority shareholders."

Strukov is the owner of 67.85% of UGC, Russia’s fourth largest gold producer. He told the TASS agency on Friday that he "works quietly" in Chelyabinsk where he is the deputy speaker of regional parliament.

He declined to comment about the decision to seize his stock.

News agencies reported that Russian investigators searched the UGC offices in connection with criminal charges relating to violations of environmental laws and industrial safety laws.

According to the agencies, who cited a source from law enforcement, on Thursday, prosecutors wanted to convert Strukov’s entire stake in UGC into state property.

Strukov's fortune, estimated by Forbes to be $1.9 billion, has been placed under sanctions by several Western countries. Britain was one of them, as it said that his role as director of a Russian company involved in the extractives sector supported Russia's government. (Reporting Anastasia Lyrchikova; Writing by Lucy Papachristou, Editing by Mark Trevelyan).

(source: Reuters)