LONDON Dec 9 Lenders to troubled Stemcor, the
world's largest steel trader, have been selling their exposure
to hedge funds and distressed debt specialists before a key
restructuring deadline on December 13, banking sources said on
Banks have taken a hefty loss to sell around $250 million of
privately-owned Stemcor's loans to aggressive debt investors
since the summer at 40-52 percent of face value, the bankers
A new $30 million block of Stemcor's loans was put up for
sale last week and another $34 million block traded in November
at around 52 percent of face value, the sources said.
Stemcor was not immediately available to comment.
Privately-owned Stemcor had to put a standstill agreement in
place in June after failing to refinance a maturing $850
million, 364-day loan earlier this year.
Under a standstill agreement lenders agree not to ask for
repayment and work with the company to restructure the debt or
extend its maturity.
The company won a further 100-day extension on the
standstill agreement in late September, which bought time to
finalise a restructuring, repayment and refinancing plan on two
loans totalling $1.25 billion.
Stemcor has to agree the restructuring plan, which is being
led by PwC with Stemcor's bank co-ordinating committee, which
includes ABN AMRO Bank, HSBC, ING, Natixis and Societe Generale.
The restructuring plan will be implemented in 2014/15.
As part of the restructuring plan, Stemcor is trying to
conclude the $1.3bn sale of its Indian ore assets through an
international auction by December which initially attracted
opposition from ICICI Bank.
(Editing by Tessa Walsh)