Russia’s Mechel, VTB agree to delay debt redemption to April 2022

MOSCOW, Dec 26 (PRIME) -- Russian metals and mining group Mechel and the country’s second largest bank VTB have signed an agreement to delay debt redemption to April 2022, as seen by PRIME in the company’s materials on Monday.

In May 2016, Mechel shareholders approved restructuring of U.S. $5.1 billion debts to banks, including $1.267 billion to Sberbank, $1.792 billion to Gazprombank, and 1.068 billion to VTB. The restructuring allows the company to change the interest rates, delay redemption to 2017–2020 or to 2022 on suspensive conditions, and increase the ruble part of the debt, while banks agreed to write off the bulk of penalties and fines.

In September, Mechel CFO Sergei Rezontov said that the company was also finishing talks on restructuring of $1.5 billion debt to international creditors besides coordination of the agreement with VTB, and after all agreements are signed Mechel will be to redeem $550–700 million in 2017, of which interest will account for $400–500 million and principal debt for $150–200 million.

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