Rusal gets permanent waiver of defaults, drops scheme of arrangement

By Toni Weeks

San Luis Obispo, Calif., Aug. 20 – United Co. Rusal plc announced that the amendment agreement for its $4.75 billion and $400 million pre-export finance facilities became effective on Wednesday, at which time the lock-up agreement was terminated, and the defaults specified in the lock-up agreement were permanently waived.

The company said it is no longer pursuing the schemes of arrangement and has discontinued those processes.

As previously reported, the company proposed to schedule a meeting of its lenders on Sept. 8 to vote on a scheme of arrangement, which would combine its pre-export finance facilities into a single facility. The company’s application for the scheme of arrangement was heard by the High Court of Justice in London on July 10, and the court authorized the convening of the lender meeting. The company asked for similar authorization from the Royal Court of Jersey on July 15, and that authorization was given as well.

The scheme of arrangement would have required the support of at least 75% by value and a majority in number of the lenders.

As already noted, 94% of the lenders by value had entered into a lock-up agreement under which they would vote in favor of the scheme of arrangement.

In April, a majority of the lenders agreed to forbear from exercising any rights they had as a result of certain defaults to, among other things, accelerate the facilities or take any steps to begin any insolvency proceedings against the company.

The forbearance period was originally scheduled to end July 7. On July 2, it was extended to the earlier of (a) Oct. 31 or such later date as might be agreed, provided that the date was not later than Nov. 30, and (b) the date on which the combination of the finance facilities becomes effective.

Rusal is an aluminum company based in Moscow.

© 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.