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Metinvest proposes partially restructuring guaranteed notes due 2015 to note holders

1901

Metinvest mining and metal holding has proposed that the holders of its $500 million guaranteed notes due on May 20, 2015 receive 20% of the principal of the debt on May 20 and the rest of the notes are exchanged to new guaranteed notes due ton November 24, 2017.

According to a report of Metinvest on the Irish Stock Exchange (ISE), the coupon rate will be increased from 10.25% to 10.50% per annum, and the note holders who agree to exchange the notes before October 31 will receive a bonus of 1%.

"The issuer is seeking to reduce its debt service obligations due in 2015 and achieve a more efficient maturity profile, which would allow it to maintain its operations through the current crisis in Ukraine, while offering the holders of the existing notes the possibility to receive a higher coupon while extending the maturity of a portion of their holdings of existing notes and converting the remaining portion of their holdings into cash at par value," the company said.

"In particular, the Issuer is making the Exchange Offer at this time in order to increase amounts of free cash that will be available to it in 2015, as well as to preserve working capital to maintain production levels and the minimum level of investment needed to sustain its business," Metinvest said.

Deutsche Bank AG, London Branch and ING Bank N.V., London Branch are acting as dealer managers and The Bank of New York Mellon, London Branch is acting as exchange agent.

The exchange offer is made on the terms and subject to the conditions set out in the exchange offer Memorandum dated 21 October 2014 and will expire on November 18, 2014.

The minimum participation condition is $450 million.

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