Russia's Evraz gets consents needed to amend 8 7/8%, 8¼%, 9½% notes

By Angela McDaniels

Tacoma, Wash., Dec. 7 - Evraz Group SA has successfully concluded the consent solicitation for its $1.3 billion of 8 7/8% notes due 2013, its $750 million of 8¼% notes due 2015 guaranteed by Mastercroft Ltd. and its $700 million of 9½% notes due 2018, according to a company news release.

The consent solicitation began Nov. 12, and the noteholders voted at a meeting on Dec. 7.

The company sought and received consents to insert customary exceptions to the covenant requiring the company and its subsidiaries to not incur debt other than where the leverage ratio is 3 times or less. The principal exceptions are:

• Intercompany debt incurred among the company and its subsidiaries;

• Debt incurred to refinance certain permitted debt;

• Up to $75 million principal amount of debt, provided that if an item of debt incurred under this section can subsequently be incurred within the 3 times leverage ratio, such debt will be deemed not to have been incurred under this exception; and

• Debt of an acquired person or in connection with an acquisition of assets provided that after giving pro forma effect to such acquisition, either the company would have been able to incur $1.00 of additional debt under the leverage ratio or the leverage ratio is less than it was immediately prior to giving effect to that acquisition or other transaction.

Evraz also sought to amend the terms of the 8¼% guaranteed notes to:

• Exclude from the definition of debt such debt borrowed from a bank or trust company that is cash collateralized in an amount substantially similar to the debt. This provision is already included in the other notes;

• Provide that the covenant requiring the company to maintain a net debt-to-EBITDA ratio of 3 times or less will not apply for the period when the ratio is required to be determined using consolidated financial statements for the measurement period ending Dec. 31, and the covenant will only be tested at the end of each semiannual measurement period; and

• Change the required net debt-to-EBITDA ratio to 6.5 times or lower through Dec. 31, 2010, 5.5 times or lower for the six months ending June 30, 2011 and 3.5 times or lower for the six-month periods after that.

Holders who voted in favor of the changes prior to the late instruction deadline will be eligible to receive the applicable instruction fee by Dec. 11 if they hold notes via Euroclear or Clearstream, Luxembourg or by Dec. 28 if they hold notes via Depository Trust Co.

J.P. Morgan Securities Ltd. was the global coordinator and joint solicitation agent. Barclays Bank plc, Deutsche Bank AG, London Branch and Royal Bank of Scotland plc were joint solicitation agents, and Bank of New York Mellon, London Branch was the tabulation agent.

Evraz is a Moscow-based vertically integrated steel and mining concern.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.