Russia Metals and Mining, Uralkali
Uralkaly, which actively develops its capacity after the accident at mine in November 2014, has attracted $1.5 billion from Sberbank for investments and debt refinancing. Through until 2020, the company plans to invest 300 billion rubles in the production, at the end of June its debt amounted to about $3.5 billion. The current ratio of the net debt/EBITDA is 1.8, but taking into account the buyback it may increase to 2.6.
Uralkaly has attracted a non-revolving line of credit from Sberbank to the amount of $1.5 billion for five years. As the company specifies, the money will be also spent for financing of statutory activities, cost of production and sales, total or partial refinancing of current loans and payment of dividends. "The advantage of the deal is that the funds will be provided on an unsecured basis, and the company is not obliged to use the whole amount of the credit line," - Uralkaly noted. The limit of the credit line is differentiated by time and tied to the cash flow projections and the need for credit resources of the company. In the period from September 2015 till May 5, 2016, it is $300 million, till July 5, 2016 - $600 million, till September 4, 2016 - $1 billion, and until March 3, 2017 - $1.5 billion.
On August 24th the Board of Directors of Uralkalii will consider the recommendation of the Audit Committee concerning the saving of its listing on the LSE as well as on opportunity of starting a new buyback program.
V. Tanukov, analyst of IK “Veles Capital”.
We don’t forecast the decision of the Board upon the issue of its listing and buyback. We only say that the expectations of a possible buyback are present in the company’s listing which has recently showed a significant growth, and in the case the expectations are not met, there is a high opportunity of a sharp fall of listing.