MOSCOW, April 10 (Reuters) - Debt-stricken Russian steel and coking coal producer Mechel said on Wednesday it had signed a 40 billion rouble ($1.28 billion) loan agreement with VTB Bank to refinance its liabilities.
Mechel said the loan had a 15-month grace period with final repayment due in five years. The interest rate will depend on the firm’s earnings before interest, taxes, depreciation and amortisation, or EBITDA, ratio.
“Securing a new credit agreement with VTB Bank will enable the company to refinance a large share of its loans which are due to be repaid in 2013, which will significantly improve the group’s debt structure in the next 12 months ” Mechel’s chief financial officer Stanislav Ploschenko said in a statement. ($1 = 31.1630 Russian roubles) (Reporting By Alessandra Prentice; Editing by Lidia Kelly)