Moscow, Russia – December 05, 2012 – Mechel OAO (NYSE: MTL), one of the leading Russian mining and metals companies, announces signing an amendment and restatement agreement in relation to a syndicated pre-export loan totalling 1 billion US dollars in order to further improve the liquidity of the company.
The amendment and restatement agreement on the syndicated loan was signed by a number of major international banks, including ING Bank N.V., Societe Generale, UniCredit, BNP Paribas SA, ABN AMRO Bank N.V., Commerzbank Aktiengesellschaft, Raiffeisen Bank International AG, VTB, Natixis, Caterpillar Financial Services Corporation, ICBC (London) plc. The borrowers are Mechel’s chief mining division enterprises —Yakutugol Holding Company OAO and Southern Kuzbass Coal Company OAO. The syndicated loan, which was in a monthly repayment phase, will now benefit from a grace period of 12 months, followed by repayment in equal monthly installments until August 2015.
The amendments were signed under the pre-export loans which were granted in September 2010 to Mechel’s main operating companies Chelyabinsk Metallurgical Plant OAO, Yakutugol Holding Company OAO, Southern Kuzbass Coal Company OAO and Southern Urals Nickel Plant OAO.
The process was coordinated by ING Bank N.V., Societe Generale, UniCredit, Joint Stock Commercial Bank “ROSBANK” and ABN AMRO Bank N.V.
“The old syndicate entered the amortization stage, which would require us to set aside some 600 million dollars of liquidity in order to service it by the end of 2013. Amending this credit is a key step in cutting down short-term debt through securing a grace period. At the same time, we managed to obtain a more favourable security package, improve the covenant and overall structure of the loan. This successful deal demonstrates the high level of trust and support our banking partners lend the company, despite the volatility of the global markets. It is also remarkable that in the current challenging environment new international financial institutions such as ABN AMRO Bank N.V., Caterpillar Financial Services Corporation and ICBC (London) plc. decided to join the syndicate,” Mechel OAO’s Chief Financial Officer Stanislav Ploschenko noted.
Mechel is one of the leading Russian companies. Its business includes four segments: mining, steel, ferroalloy and power. Mechel unites producers of coal, iron ore concentrate, nickel, ferrochrome, ferrosilicon, steel, rolled products, hardware, heat and electric power. Mechel products are marketed domestically and internationally.