Petropavlovsk Urges Shareholders to Back Loan Guarantees
February 15 2019 - 3:33AM
Dow Jones News
By Oliver Griffin
Petropavlovsk PLC (POG.LN) said Friday that it will act as
guarantor for two loans signed by a subsidiary of IRC Ltd.
(1029.HK), which has been agreed with Gazprombank (GZPR.RS) to
replace an existing loan from Industrial & Commercial Bank of
China Ltd. (1398.HK).
The mining company said the decision will depend on shareholder
approval but added that the board has unanimously agreed to
recommend that investors support the proposed guarantees.
Petropavlovsk has a 31% stake in IRC, whose subsidiary
Kimkano-Sutarsky Mining and Beneficiation Plant LLC has agreed a
loan with Gazprombank worth $240 million.
Mining company Petropavlovsk, which has assets in Russia, is to
guarantee the obligations of Kimkano-Sutarsky up to an initial
amount of $160 million.
Petropavlovsk said the loan agreements are on much more
favorable terms than the loan from ICBC, for which it currently
acts as guarantor.
Kimkano-Sutarsky will use the loan from Gazprombank Facility to
repay $169 million that is outstanding under the ICBC loan
agreement. It will also repay Petropavlovsk the ruble equivalent of
$57 million, plus fees, regarding two earlier bridging loans.
A further $6 million will be paid to Petropavlovsk regarding the
guarantee the company provided under the ICBC loan.
Write to Oliver Griffin at oliver.griffin@dowjones.com;
@OliGGriffin
(END) Dow Jones Newswires
February 15, 2019 03:18 ET (08:18 GMT)
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