VTB starting to work with Gazprombank, Vnesheconombank on Elga financing
DAVOS. Jan 21 (Interfax) - VTB is starting to work with Gazprombank and Vnesheconombank (VEB) on further financing for the Elga coal project, Yury Soloviev, VTB first deputy head, told reporters on the sidelines of the World Economic Forum in Davos.
"We have always viewed our relations with Mechel as having two stages: the first was to resolve pressing problems, because they did not make payments to us for some time. They are now making all current payments. But now the question is how to work with this company long term. We are currently looking at several big projects for them. First of all this is Elga, how to finance it in future. Work in this direction is just beginning. We are hoping for intensive work jointly with Gazprombank, VEB and Sberbank of Russia . All of them have fairly constructive attitudes," Soloviev said.
Soloviev also said he thought some sort of measures of state support might be considered for Mechel , which owns the license to the Elga field.
"Since Mechel is included on the list of strategic enterprises, it is entirely possible that some measures of state support will be considered. This is the second stage of work with Mechel. We have completed the first stage as planned, before the end of 2015, and the withdrawal of the lawsuit is our obligation within the restructuring," he said.
Earlier on Thursday, VTB withdrew its lawsuit seeking 50.2 billion rubles from Mechel, halting the case's adjudication in Moscow arbitration appeals court.
At the end of November 2015, VTB chief Andrei Kostin said Mechel was ready to sell the Elga coal project in partial repayment of debt. Kostin said Gazprombank would buy the asset and that VTB would examine opportunities to participate in the deal.
Mechel has been working to agree a restructuring of its debt to creditors since the beginning of 2014. It has now concluded restructuring agreements with VTB and Gazprombank. Its deal with Sberbank is still in the negotiating stage.
Mechel's debt totaled $6.178 billion as of December 10, 2015, of which 66% is owed to the big state banks.