Russian mining firm Mechel has obtained a 12-month grace period for its US$1bn syndicated pre-export loan signed in September 2010.
The loan was in a monthly repayment phase when the amendment was signed. Following the grace period, repayment will take place in equal monthly instalments until August 2015.
The amendment and restatement agreement has been signed by ING, Société Générale, UniCredit, BNP Paribas, ABN Amro, Commerzbank, Raiffeisen Bank International, VTB, Natixis, Caterpillar Financial Services Corporation and ICBC.
The borrowers are Mechel’s chief mining division enterprises, Yakutugol Holding Company and Southern Kuzbass Coal Company. The process was co-ordinated by ING, Société Générale, UniCredit, Joint Stock Commercial Bank (Rosbank) and ABN Amro.
Mechel’s chief financial officer, Stanislav Ploschenko, says: “The old syndicate entered the amortisation stage, which would require us to set aside some US$600mn 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, Caterpillar Financial Services Corporation and ICBC decided to join the syndicate.”