VTB to allocate 51.6 bln rubles to Novostali-M to construct metallurgical complex

SARATOV. July 9 (Interfax) - VTB plans to provide 51.6 billion rubles in financing to Novostal-M holding company to construct a new metallurgical complex, namely a universal rolling mill, in Balakovo, Saratov Region, VTB said in a press release.

"The preferential loan funds are being attracted as part of a mechanism to support completed investment projects aimed at the production of priority products. Subsidies from the Russian Industry and Trade Ministry would allow the company to attract financing at a preferential rate of 'the key rate minus 5 percentage points,'" the bank said.

VEB.RF has provided a guarantee of 20 billion rubles in order to secure the company's obligations.

The holding's capacity for rolled steel production will increase by 1 million tonnes per year after the complex has been commissioned, according to the announcement. The complex will manufacture metal products for infrastructure construction, including extra-long railway tracks.

Novostal-M is a metallurgical holding company whose main assets are the Abinsk Electrometallurgical Plant and the Balakovo Metallurgical Plant.