Dec. 5 (Bloomberg) -- OAO Mechel, Russia’s largest producer of steel-making coal, got a year’s breathing space on repayments to a $1 billion loan by signing a restructuring deal with banks.
The company, which reported an $823 million loss for the second quarter of the year because of falling coal prices, got banks to agree to an amendment and restatement of the syndicated loan, it said in a statement distributed by Globe Newswire. The facility, maturing in 2015, would have repaid $600 million next year in monthly installments and these will be delayed for 12 months, it said.
“Amending this credit is a key step in cutting down short-term debt through securing a grace period,” Chief Financial Officer Stanislav Ploschenko said in the statement. “At the same time, we managed to obtain a more favorable security package, improve the covenant and overall structure of the loan.”
Billionaire Igor Zyuzin’s company wants to cut its short-term debt to less than $1 billion, Ploschenko said in October. Debt totaled $8.8 billion at the end of June and Mechel is seeking to reduce this by boosting cash flow and pushing forward asset sales, Mechel said Oct. 2. Its American Depositary Receipts rose 2.8 percent to $6.31 at 12:15 p.m. New York time.
ING Groep NV, Societe Generale SA, UniCredit SpA, OAO Rosbank and ABN Amro Bank NV coordinated the amendment, Mechel said. Other banks in the deal included BNP Paribas SA, Commerzbank AG, Raiffeisen Bank International AG, VTB Bank OJSC, Natixis, Caterpillar Inc. and Industrial & Commercial Bank of China Ltd., it said.
ABN Amro, Caterpillar and ICBC joined the syndicate as part of the amendment process, according to the statement.
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