Moscow, Russia – August 31, 2015 – Mechel OAO (MICEX: MTLR, NYSE: MTL), leading Russian mining and metals company, reports signing agreements on restructuring its loan with Gazprombank (AO) totaling 1.4 billion US dollars and 33.7 billion rubles (approx. 507 million US dollars*).
The group’s enterprises – Beloretsk Metallurgical Plant OAO, Mechel Coke OOO, Chelyabinsk Metallurgical Plant PAO, Urals Stampings Plant OAO, Southern Kuzbass Coal Company OAO, Yakutugol Holding Company OAO and Trade Port Posiet OAO – act as borrowers on the loans.
The loan agreements set the grace period on the body of the loan until April 2017 with repayment to be made in monthly installments until April 2020.
Interest payments exceeding 8.75% will be capitalized. The restructuring agreements are subject to approval by directors’ boards and shareholder meetings of Mechel OAO and the group’s enterprises.
“Gazprombank has always been very responsible in its approach toward its clients. We have longstanding ties with Mechel. Since its inception, this company conducted an active investment policy, implementing ambitious projects vital for our country, and so we decided to accommodate the company at this time of difficulty,” Gazprombank’s Chairman of the Management Board Andrei Akimov said.
“We are deeply grateful to Gazprombank for its support of our company which found itself in a difficult financial situation as the Group’s key financial payments coincided with the most serious slump commodity markets have seen in a decade. The restructuring enables us to bring our key investment projects to full capacity, which will ensure our financial stability and serve as source for repayment of our debt in 2017-2020.We spare no effort to justify Gazprombank’s trust,” Chairman of Mechel OAO’s Board of Directors Igor Zyuzin said.
* Based on the Russian Central Bank exchange rate of 66.48 RUR/$ as of August 31, 2015.
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