The Russian steel producer ESTAR Holding (ESTAR) has announced that Russian commercial bank Binbank has attracted a pool of private investors to provide the company with working capital financing and funding required for the completion of its investment projects. Binbank may also be an arranger of the refinancing of ESTAR's debt portfolio.
The steps taken by Binbank come within the framework of the consulting agreement signed at the beginning of March 2009 with ESTAR for restructuring the company's debts and finding new investors for the company.
Commenting on the company's financial state, ESTAR president Andrey Mishin said that it is not much different from that of other steel companies in Russia. "Yes, there are changes in accounts receivable and accounts payable structures going on. Customers significantly defer payments for the delivered products and, accordingly, we have had to defer payments for our raw materials, gas and power energy. But I consider that the main problem is the sharp decrease of orders for the domestic market, which has affected the production capacity use and the employment of staff. On this matter we closely cooperate with the regional authorities and with trade union organizations in order to reduce social tension. In general, ESTAR is operating in accordance with its approved 2009 budget," Mr. Andrey Mishin stated.