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Stemcor said planning asset sales as part of restructuring

Keywords: Tags  Stemcor, iron ore pellets, iron ore, Julian Verden, divestment, Michelle Madsen

LONDON — Stemcor Holdings Ltd., the world’s largest steel trader, plans to divest parts of its business in a wider restructuring process implemented by new chief executive officer Julian Verden, sources close to the company told AMM sister publication Steel First.

The privately owned steel trader is considering selling its 4-million-tonne iron ore pellet plant in eastern India, Steel First has been told.

The plant was slated to start commissioning in 2011, but that has been delayed by regulatory issues.

In addition to targeting underperforming assets, Stemcor is also looking more profitable parts of its business for potential divestment, Steel First has been told.

A spokesman for the company declined to comment on any details of the restructuring.

Stemcor has been looking to arrange a standstill agreement on $1.2 billion in loans, Steel First reported last week. Such an agreement would allow the trading house to develop a repayment proposal for two revolving credit facilities, a $225-million loan from Asian banks and an $850-million loan from European lenders.

The trading house’s banks have chosen New York-based PriceWaterhouseCoopers LLP to advise them on the request.

Fellow London-based commodities trader Balli Group Plc went into administration last month (, April 2). Sources said that the collapse of the prominent steel, nonferrous and chemicals trader, coupled with poor market sentiment, has made banks more wary about lending to trading houses.

A version of this article was first published by AMM sister publication Steel First.

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