The much awaited listing of Polyus Gold International Limited in the London Stock Exchange is now preceded by reports that the company is mulling merger talks with fellow Russian and rival Polymetal International PLC.

Polymetal International PLC had already denied in a statement that it ever started the supposed merger talks, even as shares of both gold miners jacked up on Thursday. Polyus traded at $3.25 at 4:05 p.m., up 1.6 per cent while Polymetal, up 3.8 per cent at 1,110 pence.

The deal could strike at $6.9 billion, Bloomberg reported, based on Polymetal International PLC's current value in the London Stock Exchange. Polyus Gold International Limited, on the other hand, holds a market value of $10 billion. It was reported that the merger discussions are done on the level of the mining companies' owners, and not management.

The potential tie-up of Polyus Gold International Limited with Polymetal International PLC will not only create the world's ninth largest gold miner, with projected output of more than 2.5m ounces of gold a year and combined reserves of 90m ounces, according to the UBS, but also enable Polymetal International PLC gain eventual accessto the London Stock Exchange.

"We believe it would be a good combination, as Polymetal International PLC has more expertise in developing new projects and investor relations, while Polyus Gold International Limited has a sizeable reserves base," a UBS broker said in The Financial Times, noting the merged group "could become a consolidation centre, both in Russia and globally."

"A combination could allow Polyus Gold International Limited not only to gain a London primary listing, but also access to Polymetal International PLC's experience in building new mines," Dmitry Kolomytsyn, a Morgan Stanley analyst, said in Bloomberg News.

Polymetal International PLC would definitely benefit as it gains access to Polyus Gold International Limited huge resources, he added.

Still, analysts believed that in the hanging merger, it is Polyus Gold International Limited that stand to benefit the most. Since 2010,Polyus Gold International Limited has sought an international merger to transform it into one of the largest-ranking gold producers.

Polymetal International PLC, already in the FTSE 100 index, may be less pursuing and less interested in a deal thanPolyus Gold International Limited.

Polymetal International PLC is owned by Czech billionaire Petr Kellner and Russia's Alexander Nesis. The company got included in the FTSE 100 index in December.

Polyus Gold International Limited is controlled 78 per cent by billionaires Mikhail Prokhorov and Suleiman Kerimov. Prokhorov is running for the presidency in March elections.