Magnitogorsk Iron & Steel refinances $500 mln in July-Aug
MOSCOW. Aug 25 (Interfax) - Magnitogorsk Iron & Steel Works (MMK) has refinanced $500 million of the $1 billion of debt the Russian company was due to pay in the year from July 2014 to July 2015, MMK deputy CEO for finance and economics, Sergei Sulimov said in a conference call on Friday.
The debt was refinanced in July-August, "primarily with three-year credit facilities, so we simultaneously managed to improve the structure of the debt portfolio," Sulimov said. The refinancing was obtained in U.S. dollars at an annual interest rate of less than 4%, he added.
An MMK spokesman told Interfax that, including earlier payments and refinancing, the company has completed the restructuring of this year's debt obligations.
"In 2015 we're due to repay about $1 billion. The stake in FMG will cover about 70% of this amount, and we expect to get the remaining $300 million from operating cash flow. This means that next year we plan to completely pay off our short-term debt without raising new credit facilities," Sulimov said.
Earlier on Friday MMK reported that the group had $360 million in cash and cash equivalents, $150 million in short-term financial investments (including $137 million in short-term deposits) and liquid securities (the stake in FMG) totalling $637 million as of June 30.
Sulimov said that MMK still plans to sell its 5% stake in Australia's Fortescue Mining Group (FMG) by the end of the year, but there are no specifics yet about the terms of the deal and the group is not yet holding negotiations with potential buyers. It was reported at the beginning of the year that MMK might sell this stake and use the proceeds to pay down debt.
MMK is one of Russia's largest steelmakers. The company's principal beneficiary is its chairman Viktor Rashnikov, who controls 86.6% of shares.
