The URALCHEM Group has refinanced part of its loan portfolio by bringing in a five-year syndicated loan.
Moscow, Russia (January 3, 2013) -- The URALCHEM Group, a leading Russian producer of mineral fertilizers, has refinanced part of its loan portfolio by bringing in a five-year syndicated loan. As a result of the early redemption of a number of previously obtained loans, all material collaterals have been released, loan payments have been diversified into an optimal currency basket and the average term of the loans in the portfolio has been significantly increased.
The syndicated loan was obtained on 21 December 2012 from a pool of leading international and Russian banks, including JSC Sberbank of Russia, Sberbank (Switzerland) AG, ING Bank NV, Raiffeisenbank, VTB Bank (France) SA, HSBC Bank PLC and Rosbank (Société Générale Group).
The syndicated loan has become the first loan of this kind in the company's history and attracted considerable interest from the banking community. In the process of syndication, the pool of banks was willing to provide funding of over $500 million, of which URALCHEM took $220 million. The loan documentation made provision for an option of a drawdown in Euros, which the company used. The loan period is 5 years and the company is using assignment of rights on its export contracts as security interest for the loan.
The funds raised have been allocated, among other things, to the early repayment of the company's current liabilities, which has allowed the removal of collateral obligations from the tangible assets and shares of the Group's enterprises.
"The banks' interest in the company confirms its strong financial and operating position, its competitive advantages and the attractiveness of the industry," said CEO of URALCHEM OJSC Dmitry Konyaev. He added, "The development strategy that we have chosen has allowed the company to significantly improve the structure of its loan portfolio and reduce its volume in 2012. By the end of 2012 the ratio of net debt to EBITDA has become less than 1, which is one of the best results for companies in our industry both domestically and abroad. The fact that first-class banks were willing to provide us with more than twice the amount and that the transaction has allowed us to free up collaterals, is demonstrating URALCHEM's strong financial position."
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URALCHEM, OJSC is one of the largest producers of nitrogen and phosphate fertilisers in Russia and the CIS with production capacities of over 2.5 million tonnes of ammonium nitrate, 2.8 million tonnes of ammonia, 0.8 million tonnes of MAP and DAP, 0.8 million tonnes of complex fertilisers and 1.2 million tonnes of urea. URALCHEM, OJSC is the second largest ammonium nitrate producer in the world and number one in Russia, the second largest producer of nitrogen fertilisers in Russia. Key production assets of URALCHEM, OJSC include Azot Branch of URALCHEM, OJSC in Berezniki, Perm Region; OJSC Minudobrenia, Perm; MFP Kirovo-Chepetsk Chemical Works, OJSC Branch in Kirovo-Chepetsk, Kirov region; Voskresensk Mineral Fertilisers, OJSC in Voskresensk, Moscow region.
Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of URALCHEM. We wish to caution you that these statements are only predictions. We do not intend to update these statements and our actual results may differ materially from those contained in our projections or forward-looking statements, including, among others, the achievement of anticipated levels of profitability, growth, cost and synergy of our recent acquisitions, the impact of competitive pricing, the ability to obtain necessary regulatory approvals and licenses, the impact of developments in the Russian economic, political and legal environment, financial risk management and the impact of general business and global economic conditions.