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Mechel to take $1.5 billion loan to buy Britain’s Oriel

The board of Mechel approved on Tuesday a deal to take out a $1.5 billion loan to buy Britain’s Oriel Resources Plc, Russia’s leading mining and metals company said in a statement.

Mechel made a $1.498 billion purchase offer to Oriel, a London-based chrome and nickel mining and processing company valued at around $1.2 billion, last Wednesday. The loan will be arranged by ABN Amro Bank N.V. and Merrill Lynch International. Oriel owns the Tikhvin smelter near St. Petersburg and has two deposits in Kazakhstan, including the Voskhod chrome and the Shevchenko nickel projects.

Mechel’s market capitalization is around $18.1 billion. Last year, the company increased its coal output by 25% to 21.2 million metric tons, and pushed rolled steel production up 9% to 5.1 million metric tons. (rian.ru)