The savings Bank has reached preliminary agreements with “Mechel” of debt restructuring

MOSCOW, February 10. The savings Bank has reached preliminary agreements with “Mechel” of debt restructuring, but the company needs to fulfill several conditions.

This is stated in the press service of Sberbank.

Debt “Mechel” before a credit institution is $1,267 billion

“Preliminary arrangements have been made. To complete the restructuring necessary to “Mechel” has completed the agreed number of significant conditions, including maintenance and repayment of debts and perform obligations to other major creditors. It also requires the approval of the corporate restructuring transactions from the minority shareholders of “Mechel” at the upcoming shareholders ‘meetings”, – is spoken in the message of the press service of Sberbank.

About the debts of “Mechel”

4 February it became known that the creditor banks agreed to write off most of the accrued “Mechel” fines and penalties. The total amount of the restructured debt is $5.1 billion or 80% of the total debt and includes only the main creditors – Sberbank, Gazprombank ($1,793 billion), VTB ($1,068 billion) and a syndicate of international banks ($1,004 billion). The maturity of the debt extended until 2017-2022, this is stated in the message of “Mechel”.

All the figures on debt are shown as at 30 September 2015. Used course 66,24 rubles per dollar, noted in the presentation of the company. It is known that all debt owed to Gazprombank, and VTB will be converted into rubles. While the share of ruble debt will rise from 35% to 60%.

The creditor banks also agreed to write off most of the accrued fines and penalties. After the restructuring of “Mechel” will be required to pay in 2016 is $551 million, in 2017 $624 million in 2018-2019 years $690 million, 2020 – $1,074 billion and beyond 2020 – the remaining amount of $1.5 billion.

At the moment the company has already delayed payment of $1.3 billion in the first quarter of 2016, she needs to pay another $2,08 billion as collateral for its obligations under the debt restructuring the company offers property and equipment, stocks of principal subsidiaries and guarantees of operating subsidiaries.

The Board of Directors of “Mechel” recommended to the General meeting of shareholders to be held on March 4, 2016, to approve transactions to refinance its debt. Under current law, such transactions can be approved only if they receive more than half of minority shareholders.

About the company

“Mechel” unites producers of coal, iron ore concentrate, steel, rolled products, ferroalloys, production high conversion, thermal and electrical energy. The company employs about 67 thousand people.

Chairman of the Board of Directors “Mechel” Igor Zyuzin and his relatives control 67,42% stake in the company.