Stemcor Obtains Approval From Court for Debt Restructuring Deal
Stemcor Holdings Ltd., the steel trader that defaulted on an $850 million loan last year, won permission from a London judge to restructure its debt.
Judge Colin Birss approved the plan over an objection of one creditor at a hearing today in London. A majority of the company’s lenders voted to support the “scheme of arrangement” process, which includes the company replacing existing credit facilities and borrowing an additional $1.15 billion.
Stemcor is reorganizing its debt after reporting a loss in 2012 amid lower demand for steel. The company, owned by the Oppenheimer family including U.K. politician Margaret Hodge, replaced chairman Ralph Oppenheimer with restructuring specialist John Soden and sought to raise funds by selling assets in India.
Charles Armitstead, a spokesman for London-based Stemcor employed by Pendomer Communications LLP, declined to comment on the restructuring.
Stemcor plans to use cash and proceeds from disposals, including its operations in India, to pay down the term-loan debt, the company told the court last month. JSW Steel Ltd. and Essel Mining & Industries Ltd. have offered about $800 million for Indian assets owned by Stemcor, people familiar with the matter said this month.