Eurasian Resources Group improves the terms of financing for iron ore supplies provided by the Eurasian Development Bank
Eurasian Resources Group (“ERG”), a leading diversified natural resources producer, and the Eurasian Development Bank (“EDB”), have concluded a crucial supplementary agreement on the pre-export financing of iron ore supplies from ERG's leading enterprise, JSC Sokolov-Sarbai Mining Production Association (“SSGPO”), establishing a $95 M revolving line of credit.
Under the new agreement, the repayment period has been extended by 1.5 years whilst the tranche structure has been abandoned. The agreement has further helped SSGPO optimise its financing costs. The parties devised these new terms after taking the material improvement of the financial profile and credit quality of SSGPO and ERG into account.
Mr Maxim Korzhov, Deputy Chairman of EDB's Management Board, said: 'The agreements that we have signed highlight the importance of our cooperation with ERG and our commitment to expanding our partnership'.
Dr Alexander Machkevitch, Chairman of ERG's Board of Managers, commented: 'These arrangements will further improve the Group's sustainability and promote our strategic cooperation with EDB. The new terms allow us to consider implementing promising investments in iron ore production, including in projects linked to Industry 4.0, such as the Smart Mine and the Smart Factory. I would like to express my heartfelt thanks to all representatives of both ERG and EDB who were involved in the negotiations.'
EDB had previously opened a line of credit for SSGPO, which is Kazakhstan's leading iron ore producer and a major iron ore exporter in the CIS, to provide pre-export financing for the production of iron ore concentrate and pellets. The financing had been provided at competitive market rates and arranged to run until November 2020, with an option for a further two-year extension. Under the supplementary agreement, the repayment period has been extended until April 2022.