The largest Ukrainian private energy holding DTEK Energo has entered into an override agreement which governs the long-term restructuring of the Group’s bank debt with a vast majority of its existing lenders, the energy holding reported on the website of the Irish Stock Exchange (ISE) late on March 29.
The agreement extends the maturity of the overridden facilities to June 30, 2023.
Principal indebtedness will be repaid as follows: $60 million in 2017, $40 million in 2018, $80 million in 2019, $80 million in 2020, $80 million in 2021, $80 million in 2022 and all remaining outstanding debt and accrued PIK (payable in kind) in 2023.
The interest rate on each overridden facility is the aggregate of 5 percent p.a. and EURIBOR/LIBOR as applicable, with cash interest to be paid monthly as follows: 51 percent of the interest accrued in 2017 and 2018, 60 percent of the interest accrued in 2019, 70 percent of the interest accrued in 2020, 79 percent of the interest accrued in 2021, 88 percent of the interest accrued in 2022 and 100 percent of the interest accrued in 2023. The remainder of the interest accrued shall be PIK and shall be capitalized and added to the principal indebtedness.
A quarterly cash sweep to repay/prepay the principal indebtedness is foreseen.
The agreement took effect on March 29, 2017.
“The need to restructure DTEK’s debt arose from geo-political and macro-economic circumstances that were entirely outside of the company’s control or doing. Despite this, a further central guiding principle set by the company’s shareholders and management has been the repayment in full of the debt DTEK owes and the fair and equitable treatment of creditor classes. We believe that this agreement has reached with its creditors achieves each and all of these objectives. We also believe that it has restored the confidence of capital markets in DTEK’s enduring financial strength and its ability to return to these markets in due course for raising investment capital to further improve the quality of our services and the efficiency of our operations,” DTEK CEO Maksym Timchenko said.
“Not only are there encouraging signs that Ukraine’s economy is turning around. Also, the Government has embarked on a bold process of energy sector reform that, we believe, will instill efficiency and competition and ultimately benefit the consumers and population at large. DTEK embraces the promise of a greener, more efficient and consumer-orientated energy sector that these reforms entail,” he said.
DTEK Energo was established in 2005 to manage the energy assets of the System Capital Management group, owned by businessman Rinat Akhmetov. DTEK is a vertically integrated company involved in the production and enrichment of coal, and the generation and sale of electricity.
