10 Nov 2009 15:19

Mechel's Chelyabinsk plant approves changes to Yakutugol loan covenants

MOSCOW. Nov 10 (Interfax) - Shareholders in the Mechel coal and steel group's flagship enterprise Chelyabinsk Iron & Steel Works (CHMK) at an EGM on October 30 approved changes to covenants attached to a syndicated bank loan taken out in 2007 to fund the acquisition of Yakutia-based coal producer Yakutugol, CHMK said in a statement.

CHMK told Interfax that the changes concerned collateral and guarantees.

The loan of $1.054 billion must be repaid by December 12, 2012.

Mechel cleared changes to covenants attached to syndicated loans to acquire Yakutugol and Britain's Oriel Resources with the foreign lenders at the end of last year.

Mechel raised a five-year tranche of $1.7 billion, secured by export contracts, at LIBOR + 1.5% and a three-year unsecured tranche of $300 million at LIBOR + 2.25% to pay for the Yakutia coal assets at the end of 2007. The underwriters of the overall $2 billion syndicated loan were RBS, BNP Paribas, Calyon, Natixis, Societe Generale, S