Russia's Polyus announces $6.3 billion share buyback programme

* This content was produced in Russia where the law restricts coverage of Russian military operations in Ukraine

MOSCOW, July 10 (Reuters) -

Shares in Russian gold producer Polyus leapt on Monday after the company said its board had approved a share buyback worth up to 579.4 billion roubles ($6.32 billion).

Polyus' Moscow-listed shares surged around 15% in the minutes after the announcement before settling up 7.5% as of 0928 GMT.

Polyus said the purchase price of up to 40,802,741 shares was set at 14,200 roubles per piece, representing a premium of approximately 32.56% to the July 7 closing price.

Polyus said its subsidiary, Polyus Krasnoyarsk, would carry out the offer using its own funds and external debt.

"The maximum number of shares that may be purchased represents approximately 29.99% of all outstanding shares," Polyus said.

Polyus is banking on gold prices and increased production underpinning the stability of its financial performance.

"The repurchased shares could become an instrument for various M&A deals and project financing, which would be cheaper for the company than borrowing," a Polyus representative said. ($1 = 91.6575 roubles) (Reporting by Anastasia Lyrchikova in Moscow and Alexander Marrow in London; additional reporting by Caleb Davis; Editing by Mark Trevelyan)