24 Sep 2009 14:34

Alfa Bank files bankruptcy suits against SUAL, KrAZ

MOSCOW. Sept 24 (Interfax) - Alfa Bank has filed suit seeking bankruptcy declarations against two United Company RUSAL (UC RUSAL) companies: SUAL (filed in Sverdlovsk region arbitration court) and Krasnoyarsk Aluminum Smelter (Krasnoyarsk territory arbitration court), the bank said in a statement.

Both suits were filed on September 24. The suit against SUAL cites nonpayment on four Alfa Bank loans. KrAZ was the guarantor for the loans and thus must answer in equal measure for the failure to repay them.

On May 26 arbitration court in Moscow ordered SUAL and KrAZ to pay $73.812 million, including $71.3 million in principal and $607,650 in interest on the loans, as well as $1.89 million in penalties. On August 7 Ninth arbitration appeals court let the May ruling stand, whereupon it entered force.

"The drawn-out talks on restructuring the debt owed to Alfa Bank by enterprises in the Basel group have not brought results, despite the fact Alfa Bank is ready to sign an agreement on restructuring debts owed by GAZ Group. Under the circumstances, Alfa Bank reserves the right to defend its interests in court. Alfa Bank is also in talks with other Basel creditors on the possible purchase of their creditor rights toward enterprises in the group, including to RUSAL and En+, in order to strengthen its position as a Basel creditor," the statement says.

"Nonetheless, despite the filing for bankruptcy declarations, Alfa Bank remains ready for constructive dialog with Basel and hopes to agree with the group on a debt restructuring," Alfa Bank Deputy CEO Vladimir Tatarchuk said.

Interfax has been unable to obtain comment from RUSAL.

Alfa Bank has adopted the harshest stand against Oleg Deripaska's Basel group among all its creditors. Alfa Bank, Russia's largest privately owned bank, has taken legal action against virtually all the major companies in the group, not only seeking to collect on debts, but also seeking freezes on the companies' accounts. Basel says companies in the group owe approximately $650 million to Alfa Bank, of which loans representing half that amount are in arrears.

Mikhail Fridman, the chief beneficiary of Alfa Bank, and Deripaska made a joint public statement in March that no conflict between them was possible due to their close friendship. However, the situation has not improved since then. Indeed, Alfa Bank recently initiated bankruptcy proceedings against at least two Basel companies Baikal Pulp and Paper Mill and Glavmosstroy. In addition, Alfa Bank is the only member of the GAZ creditors' committee to reject the terms of the debt restructuring agreement.

For its part, Basel has sought to have a court invalidate or amend the loan agreements with Alfa Bank on the grounds that economic conditions have changed dramatically.

Vnesheconombank (VEB) currently holds 25% of shares in KrAZ (along with other assets) pledged as security for a $4.5 billion loan provided to RUSAL to refinance foreign debt. VEB also has a representative on the KrAZ board of directors.