Russian mining company
) announced that it has reached an agreement with its creditors
on covenant holidays, for its $1 billion loan, until the end of
2014. The agreement was inked on behalf of a syndicate of banks,
including ING Bank N.V., Societe Generale, UniCredit,
Commerzbank, Raiffeissen Bank International, VTB, Caterpillar
Financial Services Corporation and ICBC (London).
The company is making notable progress in negotiations with other
international creditors on covenant holidays and it expects to
reach agreements, on the finalization of the financial covenant
holidays, in the coming weeks.
Mechel has a debt-laden balance sheet with total debt of roughly
$9.3 billion as of Mar 31, 2013. Mechel released its operational
results for third-quarter 2013 recently. In the quarter,
Mechel's coal production was 7,028,000 tons, roughly flat
Mechel is a prominent player in the steel industry along with
). The company is a leading domestic steel and coal producer with
a strong position in key businesses, including production of
specialty steel and alloys. It has the largest coal reserve base
in Russia and is mainly focused on growth and cost-cutting
Mechel owns and controls essential infrastructure; including
ports, rolling stock and power plants; which provide access to
the export markets. However, Mechel could be jeopardized because
of its high debt and interest burden, and might not be able to
keep up with its huge capital spending program.
Mechel currently carries a Zacks Rank #3 (Hold).
Other companies in the steel industry with a favorable Zacks
Companhia Siderurgica Nacional
United States Steel Corp.
). While Companhia Siderurgica holds a Zacks Rank #1 (Strong
Buy), United States Steel has a Zacks Rank #2 (Buy).
ARCELOR MITTAL (MT): Free Stock Analysis
MECHEL OAO ADS (MTL): Free Stock Analysis
CIA SIDERUR-ADR (SID): Free Stock Analysis
UTD STATES STL (X): Free Stock Analysis
To read this article on Zacks.com click here.