“Mechel” has agreed on the terms of debt restructuring with creditors – RBC

The building of” Korshunov GOK » Photo: TASS

After two years of negotiations on the restructuring of “Mechel” of the debt could reach an agreement with major lenders – Sberbank, Gazprombank, VTB and a syndicate of international banks. They account for $ 5.1 billion, or 80% of total debt

The fact that “Mechel” has reached an agreement on debt restructuring with all creditors, said in his address to the shareholders of “Mechel” the main owner and Chairman of the Board Directors Igor Zyuzin’s company (owns 67.42%), which is Thursday night sent the press service of the company. As part of the agreement start date of the repayment of debt carried over in 2017, and for the most part of the loans can be rescheduled for 2020, according to the “Mechel” message. In the spring of 2014, when the company began negotiations with creditors, the total debt of “Mechel” was more than $ 9 billion. In the first nine months of 2015 it dropped to $ 6.45 billion.

will be restructured debt by $ 5.1 billion (80% of total debt). It is a duty before the main creditors of the company: Sberbank ($ 1.267 billion), Gazprombank ($ 1.793 billion), VTB ($ 1.07 billion) and a syndicate of international banks ($ 1.004 billion) to the company’s presentation. The remaining debt ($ 1.3 billion) – a “small creditors” (EDB, Raiffeisenbank, “Uralsib” and others), credit export agencies, and Russian bonds, said a representative of “Mechel”. On the part of the creditors the company has already agreed to the restructuring, with the rest being negotiated, he said.

According to the presentation of “Mechel”, the largest debt to the creditors the company had to repay before the end of 2018. This has been overdue on $ 1.314 billion, and for 2016 have been due to the $ 3.466 billion Under the terms of the restructuring of the debt repayment period is extended up to 2022:. In 2016, the company has to pay only $ 551 million (of which in the first quarter – $ 476 million) and the remainder of the debt evenly stretched to six years, according to a presentation of “Mechel»

The entire debt to Gazprombank and VTB, which “Mechel” failed to agree on the basic conditions restrukutrizatsii back in. last year, will be converted into rubles. As a result, the share of ruble debt will rise from 35 to 60%. Interest rates are tied to LIBOR and the key rate of the Central Bank instead of the volatile rates MosPrime. Due to the partial capitalization of interest denominated interest payments will be paid based on the rate of 8.75% per annum, instead of the current 12,5-14,5%. Banks agree to write off a large part of the accrued fines and penalties, according to the presentation.

With the Savings Bank, the last of the major creditors who did not agree to go “Mechel” for concessions, a pre-agreed fixed payments in 2016 and 2017 ($ 551 million and $ 106 million respectively, instead of the more than $ 1 billion over two years). According to a source involved in the negotiations on the restructuring of $ 500 million of debt to Sberbank in 2016 “Mechel” plans to repay by selling assets, such as shares “Elgauglja” develops Elga coal deposit. Subject to the conditions of the period of delay debt repayments will be four years. In ruble loans of the Central Bank key rate will be 1.5% (but not less than 8.75%), on dollar – the three-month LIBOR +7%

Collateral for loans in these three banks include property and equipment. shares of major subsidiaries and their sureties. Parts representative of “Mechel” has not opened. The main shareholder of “ Mechel » Igor Zyuzin will not to pledge their shares and bail, said RBC source , close to the “ Mechel » .

« As we have previously reported, we are working closely with “Mechel” in the framework of the agreements concluded to restructure the company’s debt. At the moment, work continues on the final execution of the restructuring conditions “, – he said on Thursday evening RBC spokesman VTB. The representatives of Gazprombank and Sberbank declined to comment.

The completion of the restructuring will require the approval of a number of transactions at an extraordinary shareholders’ meeting, said “Mechel”. Under current law, such transactions may be approved only if they vote for more than half of minority shareholders or owners of 16.29% shares of “Mechel”. This issue will be considered at an extraordinary meeting of shareholders on March 4. If these transactions are approved properly, not just some of the terms of the restructuring can not enter into force, it can negatively affect the process of restructuring as a whole, has warned shareholders the company.

The leader of the Society Russian minority shareholders of “Mechel” (representing approximately 2.5% of the owners of securities of the company) Elvis Marlamov says he supports the restructuring conditions and the situation is beneficial to minority shareholders to collect the required package.