Alrosa refinances $600 mln in loans, prepays $120 mln
MOSCOW. Dec 5 (Interfax) - Alrosa has refinanced $600 million and prepaid $120 million in bank loans, the diamond miner said in a statement.
Alrosa said it had "improved its loans and borrowings position to reduce financial costs." The company has made an early repayment of a part of its $720 million bank loan due in 2019 with an interest rate of 4.3%, and refinanced the remaining balance at lower rates, it said.
In July 2017, S&P improved Alrosa's credit rating to match the BB+ sovereign rating, which has opened up new opportunities for borrowing cost reduction, the company said.
From September to November 2017, Alrosa conducted a competitive procurement process among Russian and international banks, following which $600 million out of $720 million was refinanced through two new loans of $350 million and $250 million issued by Raiffeisenbank and Rosbank, respectively, due for repayment in December 2018. The remaining balance of $120 million was repaid ahead of schedule using the company's free cash flow. These initiatives have reduced Alrosa's debt to $1.84 billion.
"We managed to borrow from international banks at a rate lower than the yield to maturity of Alrosa's Eurobonds, which confirms the company's stable financial position. The impact of lower interest rate payments driven by these initiatives will exceed $30 million," said Alexey Filippovsky, CFO.
Alrosa told Interfax that it intended to pay down $211 million of its short-term debt from its own funds before the end of the year. It said $210 million of this was a UniCredit loan.
Alrosa's net debt/EBITDA was 0.7x at the end of September. The company said in a presentation in November that it had $211 million to pay off before the end of this year and $18 million next year. It said 88% of the debt was dollar-denominated and the rest was ruble debt.