ING Bank and UniCredit Tiriac Bank will each provide financing lines worth EUR50 million to Mechel and three other companies owned by Mechel group in Romania, namely Mechel Campia Turzii (INSI.RO), Laminorul Braila (LMRU.RO) and Ductil Steel Otelu Rosu.
The proposal is subject to shareholder approval at a meeting due July 22.
Mechel Targoviste reported loss of 12.6 million lei (EUR3 million) in the first quarter, narrower from RON28.7 million in the same period a year earlier. The company expects full-year loss of RON17.3 million, versus RON155.16 million in 2010.
Russian steel giant Mechel, through its subsidiary Mechel International Holdings, owns 86.6% in the company, while the Romanian privatization authority AVAS holds 4.04% of its shares.
On the Bucharest bourse June 1, Mechel closed flat at RON1.15 a share. (EUR1=RON4.2635)