OREANDA-NEWS. Mechel OAO (NYSE: MTL), one of the leading Russian mining and metals companies, announces reaching agreement on covenant holidays on its USD 1 billion syndicated facility until the end of 2014.

The agreement was signed on behalf of a syndicate of leading international banks, including ING Bank N.V., Societe Generale, UniCredit, Commerzbank Aktiengesellschaft, Raiffeissen Bank International AG, VTB, Caterpillar Financial Services Corporation, ICBC (London) plc.

The borrowers under the agreement are Mechel's main mining division enterprises -Yakutugol Holding Company OAO and Southern Kuzbass Coal Company OAO.

The process was coordinated by ING Bank N.V., Societe Generale, and VTB Capital.

“Obtaining covenant holidays from the pool of international lenders in such difficult market circumstances and in a short period of time is a major milestone in our debt refinancing process and a clear acknowledgement by leading financial institutions of our successful efforts aimed at asset restructuring. We are witnessing significant progress in negotiations with our international creditors on the finalization of our debt optimisation discussions, and we hope to also reach agreements with other lenders in the upcoming weeks for the finalization of the financial covenant holidays” said Mechel's CFO Stanislav Ploschenko.