VTB has signed an agreement with Mechel to restructure the company’s debt. Decreasing the group’s debt volume was made possible as a result of the sale of Mechel’s 51% stake in the Elga Coal Complex to A-Property, according to the bank's press release
The proceeds of the sales transaction were used to repay debt obligations to VTB and Gazprombank in proportion to their share in Mechel Group’s credit portfolio. As a result, Mechel Group’s debt to VTB will decrease by approximately RUB 50 bn and will amount to approximately RUB 163 bn. The credit repayment period will also be extended by 7 years until March 2027 with the possibility of an additional 3-year extension. Other key credit line conditions, including those related to interest rates and collateral, remain unchanged.
Yuri Soloviev, First Deputy President and Chairman of VTB Bank Management Board, noted: “VTB is Mechel Group’s long-standing partner, and this agreement demonstrates the bank’s ongoing efforts to support the company. As the company’s largest lender, we welcome Mechel’s sale of its share in the Elga deposit. The transaction will allow to optimize the company’s debt profile, positively impact efficient development of Mechel’s core assets, increase production volumes and improve its ability to service outstanding debt.”