Mechel failed to find its owners

Debt restructuring is delayed due to foreign shareholders.
Minority shareholders of "Mechel" Igor Zyuzin became an obstacle to the restructuring of the main part of the company's $ 6.2 billion debt. The company was unable to raise the voice of their foreign shareholders - owners of the ADR, which had to approve the transfer of creditor banks to pledge the shares of the holding company and other software. Now these questions have peregolosovat at another shareholders' meeting that the decision to postpone the debt problems of "Mechel". But the creditors and the company claim that the delay in the process would not be a serious problem.

"Mechel", controlled by Igor Zyuzin (owns 67.42% with a family), failed yesterday at an extraordinary meeting of shareholders quorum for approval of the restructuring conditions of the main part of its debt. Under the restructuring fell $ 5.1 billion in debt: $ 1.8 billion to Gazprombank (GBO), $ 1.27 billion to Sberbank, about $ 1 billion to VTB and another $ 1 billion to a syndicate of foreign banks. Their repayment should be deferred to the 2017-2020 years with the possibility of a delay until 2022-2023 years. "Mechel" has to make a pledge to creditors new shares in companies Kholdinga and equipment, which required more than half of minority votes.

But this was not achieved. According to general director of "Mechel" Oleg Korzhov, around two free-float of the company is represented by US-thirds of receipts for shares (ADR), but the new requirements of the Central Bank to the identification of foreign shareholders in the autumn of 2015 made it difficult to last the voting process. Now they must indicate the number and date of registration in the register of the company and of the shareholders could not have time to provide this information, and some - just be lazy, explained a top manager. According to the Director of Legal Affairs of "Mechel" Irina Ipeevoy between Deutsche Bank, end the ADR depositary, and their owners there is a link of several intermediate depositories, which also complicates the process. Operational data on the ADR holders vote in the registrar NRC presented yesterday, saying only that a quorum is not present. But up to 85% of the owners of Russian stocks took part in the vote, said Mr. Korzhov. A new meeting of shareholders may be held in May, he admitted.

After the announcement of the absence of a quorum to sharepany fell on the Moscow Stock Exchange by 20%, but lost 7.23% in trading, market capitalization amounted to 26.64 billion rubles. ($ 370 million). On the NYSE the capitalization of "Mechel" on 20:00 Moscow time amounted to $ 387 million, ADR fell 5.56%. Thus, the entire free-float yesterday was estimated at about $ 120 million. In "Mechel", and the creditors have no plans to buy out the minority shares, to remove the risk of assembly failure, the company said, adding that consultations with the banks continue their tone of "constructive ".

VTB reiterated yesterday that "work closely" with "Mechel" in the framework of agreements on debt restructuring. Sberbank said that, "according to the law, the company has the ability to hold the next meeting and approved in the near future that allows you to complete the transaction at the agreed time." The GBO not answer the question "Kommersant". Sources "Kommersant", close to the creditors of "Mechel", confirm that there are no problems: adoption of decisions moved "for technical reasons". Even if the final documents could be signed until the end of the quarter, it is not much help to the bankam terms of reclassification of the debt of "Mechel" in reporting and the possibility of the dissolution of reserves for him, they say.

Alexander Danilov from Fitch believes that some state-owned banks - lenders, "Mechel", who already created high reserves for debts of the company (it is, rather, about the Savings Bank) may dissolve some of them, if the actual provision of new deposits will be made and financial model, calculated on the basis of the new rates and terms, shows that the company is able to maintain and extinguish the debt. "Restructuring is not the effect on reserves: will dissolve them only to the extent of debt repayment" - confirms the source "b" creditors "Mechel". In order to improve the quality of debt, the company needs to make it "in the six months to make six payments," he adds.

One of the key commitments of "Mechel" in the framework of restructuring - the repayment in the first quarter of approximately $ 500 million debt to Sberbank. Earlier sources said that it is planned to make by selling a stake in GBO Elga coal project (mine with reserves of about 2 billion mantastonnes of coking coal and 321 km railway to the BAM). Oleg Korzhov yesterday admitted that such negotiations are conducted with GPB, the agreement is planned to be finalized by the end of March. Moving approval of the restructuring conditions will not affect the agreement with Sberbank, added in "Mechel".