Russia pays off $1 billion of oligarch Vekselberg’s debt
The Russian oligarch Viktor Vekselberg, who has recently been placed under sanctions, has paid off his loans to western banks using financial assistance from the government.
Vekselberg’s Renova Group repaid $1 billion to a consortium of European, Swiss and American banks, including JPMorgan, Credit Suisse, and UBS.
The loans needed to be repaid in a hurry. The US Treasury Department, which recently blacklisted Vekselberg and all of his companies, demanded that all deals be broken off by June 5, otherwise the banks who had given loans to Renova would risk falling under “secondary sanctions”.
Two weeks before the deadline, the banks had already received the funds, a Renova representative told Reuters. This was confirmed by another source close to the Russian billionaire.
Vekselberg had to repay two loans, one amounting to $720 million, which he received 5 months ago. The second, for 350 million, was issued in July 2016. Shares in Vekselberg’s key Swiss assets, including the Schmolz + Bickenbach steel company, were used as collateral for the loan.
Renova received the funds it needed from Promsvyazbank in the middle of May, the Russian Finance Ministry reported last week.
Promsvyazbank in turn received the funds from Russia’s Central Bank, which has poured a total of 443 billion rubles into the bank since it was nationalized in December last year.
A Renova representative said on Saturday that the company had repaid the loans with “its own funds”.
According to Kommersant, the refinancing of $1 billion worth of western loans is only part of the support requested by Vekselberg.
The billionaire, who holds 9th position in the Russian Forbes list with $14.4 billion, will also need assistance to refinance 300 billion rubles worth of loans and bonds, or $4.7 billion, if his group’s companies are placed under secondary sanctions and are unable to service the debt.
Vekselberg has also requested authorization for Renova to receive unlimited credit through Metkombank, whose primary beneficiaries are Vekselberg and his companies’ top managers.