Hindalco $982-million loan terms revised

NEW DELHI: Leading aluminium and copper producer Hindalco today said it has reached an agreement with the lenders to relax the terms on a USD 982 million loan taken last year to part-finance the acquisition of Novelis.

"... the company has reached agreement and received lenders' consent on revised terms including covenant relaxations relating to the USD 982 million bank loan," Hindalco said in filing to the Bombay Stock Exchange.

Last year, the firm had secured the loan to help in refinancing its USD 3.03 billion bridge loan taken to acquire Canadian aluminium major Novelis in 2007.

The aluminum major paid USD 6 billion for Novelis last year to gain access to strong markets for the metal, targeting buyers like Coca-Cola and Ford Motor.

The lenders' approval gives flexibility to the company to "plan its future business" and its "capital expenditure", the Aditya Birla Group firm said.

"The new terms allow the company siginificant flexibility to plan its future business and pursue its capital expenditure ... Under the new agreement reached banks have agreed to waive requirements to test covenants on consolidated financials," it said.

Hindalco has chalked out a Rs 25,000-30,000 crore capex plan till FY'13 to fund its expansion projects. It posted a 77.87 per cent fall in net profit in 2008-09.