Kinross Gold Corp. has executed an exit strategy in Russia.

The Toronto-based miner announced Tuesday morning it struck a deal to sell its Russian assets to Highland Gold Mining Ltd. for US$680 million in cash, pending approval by the Kremlin.

Under the terms of the transaction, Kinross said it will receive US$400 million for its Kupol mine. The payments will be staggered over three years, starting with US$100 million when the deal closes. As well, Highland will pay US$280 million — staggered across three payments before the end of 2027 — for Kinross’s Udinsk project.

“A sale of the assets to a third-party mining company is a positive in our view as it eliminates potential environmental risk by transferring ownership to a capable third party with mining knowledge, which we view to be especially important given the remote nature of the Kupol asset,” wrote National Bank of Canada Financial Markets Analyst Mike Parkin in a report to clients Tuesday, adding that he thinks Kinross received “fair to good value, given the circumstances.”  

He has an outperform (the equivalent of a buy) recommendation on Kinross shares and a 12-month price target of $11.00.  

The deal was announced one week to the day since Kinross disclosed it was in exclusive negotiations to sell the assets.

Kinross originally stated on Feb. 23, on the eve of Russia’s invasion of Ukraine, that its Russian operations were continuing unimpeded by U.S. sanctions against Moscow. However, the company stated at the start of March that it was suspending operations in the country.

Highland’s operations are focused in Russia; however, the company is based in Jersey of the British Isles.