Severstal flops as banks wind down Russia loans
The $1.2bn facility for Russian steelmaker Severstal, led by eight banks, has closed without picking up any commitments in general syndication. It failed to gain traction against a backdrop of market turmoil and falling steel prices. The deal, one of the biggest to launch in Russia since September, struggled as a result of the chaos in the markets following Lehman Brothers’ bankruptcy. But the Russian steel industry has also suffered from a price slump. Severstal announced in October it was cutting production by 30% for the month.
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