Doctor never came: why Mechel collapsed

Shares of Igor Zyuzin's company collapsed by 40% for no apparent reason.
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On Wednesday, late in the afternoon on the Russian stock exchange has fallen off, "Mechel" (the main owner - Igor Zyuzin, which occupies 58 place in the rating of Russian billionaires Forbes with an estimate of $ 1.8 billion state) - the company's shares have lost 41.35% in two hours. The fall began at 16:30 MSK, and at first it was slow. The sharp decline in quotations started at 17:10, an hour quotes lost 32 rubles. Bidding closed at the level of 56.3 rubles per share. The Moscow stock exchange owing to the recently introduced new rules do not stop trading if the drop occurs after 17:00, which allowed the shares of "Mechel" leave practically in free flight.

The fall continued after the opening of the stock exchange in New York. Paper companies at the moment have fallen by 43%, but by 22:00 MSK ADR «Mechel" partially won back the fall. The reduction of the previous day's close was 18%. Capitalization of "Mechel" at the bottom of $ 830 million. For comparison, May 30, 2008, the company was worth $ 24 billion.

No public events that could trigger a fall, did not happen. While analysts and managers say that a collapse could trigger rumors of inPossibility default "Mechel" for the debts. Company representatives were quick to refute these arguments. "Negotiations with the banks about kovenantnyh vacation and debt restructuring are successful, we expect to complete them before the end of November. No adverse events in the company does not take place ", - said the representative of" Mechel "Arseniy Palagin. The company is currently in talks with lenders to amend the terms of the loan.

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The company's debt is $ 9.5 billion, 58% of its accounts for Gazprombank, VTB and Sberbank. Another 16% of the debt falls on the issues of "Mechel" bonds, most of which belongs to the state banks. Bonds fall since mid-November. Today ruble bonds traded at 60% of face value, and the yield soars above 90%.

First Vice President of Gazprombank (which "Mechel" should be $ 1 billion) Ekaterina Trofimova said that the fundamental reasons for the fall are no shares. "The work carried out" Mechel "for the sale of non-core assets, the completion of major investment projects, as well as additional financing and location of the project site Elgaozhdeniya say that the situation has stabilized, "- said Trofimov, adding that discussion of covenants on loans is on schedule and in a positive way and be completed by the end of November. Analysts say that the bankers will make concessions and "Mechel" will not declare a default.

Ctremitelnoe shares fall came as a surprise to market participants. "The fact that negotiations on the covenant will come, it was clear after the announcement of results for the first quarter of this year, when the ratio of net debt to EBITDA was equal to 8, while in accordance with the condition (covenants) loan this figure should be 7.5 "- says senior analyst BCS Maria Radchenko. It's no secret, she adds, that "Mechel" is held only by banks, but this year the company repaid on the bonds of 35 billion rubles and the coupon pays regularly.

Forbes interlocutors in the stock market suggest that the fall was due to the fact that one of the holders of securities occurred margin call, after which the package was sold to his broker. "It nemarzhinalnaya paper, t. E. Margin call could be cluchae, if the paper were used as security for bank loans - objection predpravleniya "Finam" Vladislav Kochetkov. - However, a normal bank would not blame the market. Most likely I played a factor speculative. " According to him, the paper bought for speculative purposes, and after a slight fall started, stopped out - collapse with limited demand was inevitable.

On Tuesday evening, the financial director of "Mechel" Stanislav Ploschenko gave a comment agency Bloomberg, saying "default", but the manager spoke about the absence of the threat of technical default. Specifically, he said that the fear of technical default there is no reason, and the negotiation process with banks scheduled for completion by the end of November. Kochetkov believes that nervous and thin market can be anything, but the fall did not begin in the morning, that is. E., This factor can be only one of several.

Fallen off the value of shares of "Mechel" is not difficult, the trading volumes of the paper on the Moscow stock exchange small, for the last month did not exceed 60 million rubles. According Radchenko, shares fall dasodds creditors "Mechel", the company will be more amenable to negotiations, taking into account the fact that Igor Zyuzin more than 50% of the shares pledged under the loan. After the fall of the owner of "Mechel" have upon to pay substantial remaining 14% stake.

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Bank of Russia's Financial Markets Service has launched her own test. "The actions of a number of bidders with OAO" Mechel shares "on the open market during the period from 17 hours of November 13, 2013 are subject to close attention to service, - said in a statement agency. - Service analyzes conclude this period on the stock exchange and OTC transactions market, as well as ask for the necessary information from the company. "

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