Russia’s Magnitogorsk Iron and Steel Works (MMK) has signed an unsecured club loan worth US$500mn.

The finance has a tenor of four years, with two years’ grace, and will be used to refinance short-term elements of the company’s existing debt.

ING, Nordea Bank, Raiffeisen, the Reserve Bank of India, Sberbank and UniCredit all acted as arrangers. UniCredit was also sole co-ordinator and facility agent.

The pricing of the loan has not been revealed, but an MMK spokesperson tells GTR that in general, “the pricing of the loan is in line with our expectations and adequately fits the current loan portfolio of the group”.

He says the loan is not renewable, but that MMK is considering returning to the market for a facility in 2014.
While MMK has regularly tapped the market, it has most commonly banked with Russian financiers. In 2009, it signed a US$330mn three-year loan with Sberbank for the construction of a new plate mill. It secured a US$143mn facility from VTB Bank in 2008, used to replenish working capital.

Rather than viewing the new facility as a departure, though, the spokesperson says the company has always maintained strong relationships with the international sector. He continues: “MMK has big experience of relations with leading Russian and international banks. The company is in constant dialogue with the banking community, thereby having the most up to date information.”