Restructuring of a Debt Portfolio Exceeding RUB 80 Billion
Situation:
A PSK-Solutions client, one of Russia’s largest holdings owning and managing a portfolio of commercial real estate, engaged PSK-Solutions to assist with the restructuring of its loan portfolio amid rising interest rates and an increased need for liquidity to maintain the operational stability of its business.
PSK-Solutions’ role:
- From the outset of the project, the PSK-Solutions team provided comprehensive support to the Client in negotiations with the lending bank;
- Our team conducted a comprehensive analysis and verification of the Client’s financial model, as well as a detailed assessment of its debt burden and debt service schedule, which enabled us to develop a solution ensuring sustainable liquidity management in a high interest rate environment;
- The team developed the key restructuring terms, including an extension of the grace period for principal repayments and a reduction in the applicable preferential interest rate, and substantiated the proposed terms to the lender based on detailed financial calculations;
- Under the guidance of PSK-Solutions specialists, the loan and security documentation package was successfully agreed and executed on favorable terms for the Client, in full compliance with the lender’s requirements and within the agreed timeframe.
Results:
With the support of PSK-Solutions, the Client successfully restructured more than RUB 80 billion of debt obligations in full.
As a result of the transaction, the Client secured a two-year extension of the grace period for principal repayments, significantly reducing its current debt burden and releasing substantial liquidity for operating activities. The Client also achieved a 2 percentage point reduction in the applicable preferential interest rate, resulting in a significant decrease in debt servicing costs.
The agreed restructuring terms enabled the Client to continue servicing its loan portfolio on a sustainable basis while maintaining the financial stability of the holding company.