Mechel Group in Romania receives EUR 50 mln loan from Erste Group and BCR

Newsroom 09/11/2011 | 10:41

Erste Group Bank AG and its Romanian subsidiary Banca Comerciala Romana (BCR) are granting a EUR 50 million loan to four Romanian steel production facilities, part of the Mechel holding. In 2010, iron & steel was one of the top 10 fastest growing industries in Romania, expanding by 35 percent. Over the next decade, iron & steel production in Romania is expected to continue growing by 4 percent a year on average, according to Oxford Economics Industry forecast for Romania for the autumn 2011.

The loan agreement is one of multi-borrower, multi-currency type to finance the working capital, with collaterals (stocks and receivables) as well as with a letter of guarantee issued by the mother company Mechel OAO. The EUR 50 million represent the refinancing of some credits worth a total of EUR 35 million, to which a new financing line is added worth EUR 15 million.

Mechel is one of the leading Russian companies; its business includes four segments: mining, steel, ferroalloy and power. Mechel unites producers of coal, iron ore concentrate, nickel, steel, ferrochrome, ferrosilicon, rolled products, hardware, heat and electric power. The holding has been present in Romania since 2002 through 6 metallurgical units: Mechel Targoviste, Mechel Reparatii, Mechel Campia Turzii, Ductil Steel Buzau, Ductil Steel Otelu Rosu and Laminorul Braila. Mechel’s products are sold in Romania and abroad. Key destinations for export are Czech Republic, Hungary, Germany, Italy, Poland, Turkey as well as neighbour countries such as Serbia and Bulgaria.