OAO Magnitogorsk Iron & Steel (MMK), the third-largest Russian steelmaker, got a combined $1.1 billion in funding arranged by banks including BNP Paribas SA (BNP) and Royal Bank of Scotland Group Plc for a steel mill project in Turkey.
RBS and BNP will arrange 384 million euros ($570 million) of export credit facilities backed by SACE SpA, an Italian state insurer of exports, to fund the main supply contract with Danieli SpA, Magnitogorsk said today in a statement.
The credit facilities are being provided for 10 years and replace “short-term loans” previously arranged by the banks, Magnitogorsk spokesman Yevgeny Kovtunov said by phone today.
Turkiye Garanti Bankasi AS (GARAN) and Turkiye Is Bankasi AS (ISCTR) will arrange $510 million for capital spending for the mill, due to be built by December 2010, it said. Magnitogorsk will own half the plant, with capacity of 2.3 million metric tons of steel products, plus one share and Turkey’s Atakas Group the balance.
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