IUD Draws USD 275 mln Credit For Investment In Huta Czestochowa And Alchevsk Iron & Steel.

The loan will be given by a consortium of three Polish banks (PР•KРђO S.A., BRE Bank Рё PKO BP. S.A) in two parts – a long term credit of USD 200 mln and a short term loan of USD 75 mln to finance working capital. A major portion of the long term credit will be used to fulfill IUD’s investment program at Huta Czestochowa, which will allow the latter to increase production capacity to over 1.2 bln mt of flat steel and pipe strip. In addition, the Industrial Union of Donbas (IUD) will direct the remaining portion of the long term loan to finance the purchase of a second con-casting slab machine for Alchevsk Iron&Steel (ALMK: BUY). Concorde Capital: Slabs (semi-finished flat steel products) produced at Alchevsk Iron&Steel will be supplied to Huta Czestochowa and further rolled into flat steel and strip and sold on the European market. In addition, a portion of pipe billets produced by IUD’s another Ukrainian steel mill, DMK Dzerzhynskogo, will also be supplied to Huta Czestochowa to be rolled into pipes. This will allow IUD to circumvent quotas set by the EU on Ukrainian value added steel products and increase production at its Ukrainian steel mills.