UPDATE 1-Kyrgyzstan may sue Centerra Gold over stake dilution

Thu Feb 4, 2016 8:32am EST
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BISHKEK Feb 4 (Reuters) - Kyrgyzstan may sue Canada's Centerra Gold over its plans to issue additional shares, which will dilute the Central Asian nation's stake slightly, a Kyrgyz representative on Centerra's board said on Thursday.

"Our goal is to protect Kyrgyzstan's stake," said board member Kylychbek Shakirov.

Separately, a spokeswoman for state-owned firm Kyrgyzaltyn, which holds the stake on behalf of the government, said it was working on an agreement with a foreign law firm which would tackle the matter.

Kyrgyz officials said in December that a planned issue of shares by Centerra would reduce Kyrgyzstan's stake in the company to 32.1 pecent from 32.7 percent.

Kyrgyzstan and Centerra are engaged in a separate, long-running dispute over Kumtor, the country's biggest gold mine which Centerra operates. (Reporting by Olga Dzyubenko; writing by Olzhas Auyezov; editing by Jack Stubbs and David Clarke)