Mechel agrees to restructuring of Sberbank of Russia short-term debt

By Caroline Salls

Pittsburgh, Dec. 20 - Mechel OAO signed agreements with Sberbank of Russia on restructuring a part of Mechel's roughly $773 million of debt to the bank, according to a company news release.

The restructuring covers the Mechel group's short-term debt to Sberbank of Russia, maturing from December 2013 to December 2014.

Mechel said the group's obligations to the bank were extended by five years, with a grace period until the first quarter of 2015.

Under the restructuring, Mechel Group's existing debt to Sberbank of Russia will be refinanced for a total of 25.5 billion rubles. The company said the restructuring involves only the group's existing debt and will not increase Mechel Group's total debt portfolio.

"Reaching this agreement, together with our creditors', including Sberbank's, approval of covenant holidays, enabled us to stabilize our company's financial situation," Mechel board of directors chairman Igor Zyuzin said in the release.

Mechel is a Moscow-based mining and metals company.

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