DGAP-News: SKW Stahl-Metallurgie Holding AG / Key word(s): Financing SKW Stahl-Metallurgie Holding AG: SKW Metallurgie reaching breakthrough in negotiations with financing banks 15.12.2016 / 17:33 The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- SKW Metallurgie reaching breakthrough in negotiations with financing banks: * Concept for a sustainable financial restructuring of the Group to be implemented during the course of 2017 * Banks declaring willingness to a conditional cancelation of debt and to a stand-still agreement for the syndicated loan contract until December 31, 2017 * Substantial reduction of net financial debt to capital-market level sought * Cooperation discussions initiated to realize synergy potentials München (Germany), December 15, 2016. The SKW Metallurgie Group (WKN SKWM02 / ISIN DE000SKWM021), globally leading provider of primary and secondary metallurgy solutions for the steel industry, has reached a breakthrough in the negotiations with the financing parties of the syndicated loan agreement (the main debt instrument of the SKW Metallurgie Group). As already communicated by ad-hoc release, the basic points of the agreed concept, seminal for the future of the SKW Metallurgie Group, are as follows: * The financing banks of the syndicated loan contract declare their willingness to conclude a standstill agreement with a maturity until December 31, 2017 in order to implement the refinancing. * Cornerstone of this financial restructuring is an extraordinary debt repayment of the SKW Metallurgie Group based on the disposal of assets (mainly non-core activities). * In addition, the financing banks have declared their general preparedness to issue a conditional cancelation of debt, if the repayment of the debt remaining with the banks is secured by a third party. * In this context, the equity of the Company shall be further strengthened during the course of 2017 by a substantial capital increase against cash in the amount of at least 100% of the registered capital, with subscription rights for the shareholders. A corresponding motion is to be presented to the General Meeting. * A central part of the concept is the already initiated contact to strategic partners in order to mutually develop the business and to strengthen the competitive position through realizing synergy potentials. These negotiation results are to be documented in detail by end of January at the latest through a "debt reduction agreement". To that end, the existing waiver is to be prolonged until that point in time. The aforesaid concept is subject to the approval by corporate bodies of financing banks; the Company is optimistic that such approval be granted during the course of the subsequent week. "The implementation of the agreed measures will return the debt situation of the SKW Metallurgie Group to a ratio that is economically bearable for its earning power, and thereby enable the Company to sustainably advance the business strategically and operationally," comments Dr. Kay Michel, Sole Member of the Executive Board (CEO) of SKW Stahl-Metallurgie Holding AG. The common goal of all involved in the presented refinancing concept is the return to the so-called "investment grade", allowing a subsequent refinancing. To that end, it is mainly necessary to clear the historic financial burdens, which has been massively hampered since 2015 by the ongoing steel crisis. Moreover, the financial healing of the SKW Metallurgie Group is necessary basis to expand competitiveness in the crisis-prone steel industry in Europe and the Western Hemisphere. Thereby, the Group can get actively involved as relevant player in the upcoming market consolidation in the steel supplier industry, in order to return to creating values for the shareholders after the burden of operative consolidation. The comprehensive measures to increase efficiency in the SKW Metallurgie Group are in implementation and have to be supplemented by potentials for strategic cooperation. Only through joint advancement of the business and consequent realization of synergies can the structural challenges of the target markets be faced adequately. "The Supervisory Board supports the chosen path without any reservation. With this concept, the Company obtains the chance to counter the severely adverse market conditions with a proactive business approach and to thereby increase the enterprise value in the medium term again," emphasizes Volker Stegmann, Chairperson of the Supervisory Board of SKW Stahl-Metallurgie Holding AG. Contact SKW Stahl-Metallurgie Holding AG Christian Schunck Head of IR and Corporate Communications Prinzregentenstr. 68 81675 München Germany Phone IR/Press: +49 89 5998923-22 Fax: +49 89 5998923-29 E-Mail: [email protected] About SKW Stahl-Metallurgie Holding AG and the SKW Metallurgie Group The SKW Metallurgie Group is a global market leader for chemical additives for hot metal desulphurization and for cored wire and other products for secondary metallurgy. The Group's products enable steel-makers to efficiently manufacture high-quality steel products. Clients include the world's leading companies in the steel industry. The SKW Metallurgie Group has more than 50 years of metallurgical know how, and currently operates in more than 40 countries. What is more, the Group is a leading supplier of Quab specialty chemicals, which are mainly used in the global production of industrial starch for the paper industry. The SKW Metallurgie Group is headquartered in Germany with production facilities in France, the US, Canada, Mexico, Brazil, South Korea, Russia, the Peoples' Republic of China and India (joint venture). The Group reached total revenues of EUR 285.5 million in 2015 and employs around 650 staff members (as of Dec. 31, 2015). Shares of SKW Stahl-Metallurgie Holding AG have been listed in Frankfurt Stock Exchange's Prime Standard since December 1, 2006; since 2011 (conversion to name shares) with ISIN DE000SKWM021. Disclaimer This press release may include certain forward-looking statements which are based on currently available assumptions and predictions of the SKW Metallurgie Group's management as well as on other currently available information. Various identified as well as unidentified risks and uncertainties as well as other factors may result in a deviation of actual results, financial situation, development or achievement of the company compared to the assessments made herein. SKW Stahl-Metallurgie Holding AG does not intend and assumes no liability to update such forward-looking statements and to adjust them to future events and developments. --------------------------------------------------------------------------- 15.12.2016 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de --------------------------------------------------------------------------- Language: English Company: SKW Stahl-Metallurgie Holding AG Prinzregentenstr. 68 81675 München Germany Phone: +49 (0)89 5998923-22 Fax: +49 (0)89 5998923-29 E-mail: [email protected] Internet: www.skw-steel.com ISIN: DE000SKWM021 WKN: SKWM02 Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart, Tradegate Exchange End of News DGAP News Service --------------------------------------------------------------------------- 530353 15.12.2016