Amreli Steels secures major financial restructuring worth Rs22.6bn

September 24, 2025 (MLN): Amreli Steels Limited (PSX: ASTL)'s Board of Directors has approved a comprehensive financial restructuring package worth approximately Rs22.6 billion to provide the steel manufacturer a crucial breathing room to stabilise operations and pursue long-term growth.

The restructuring involves rescheduling and reorganizing the company's entire portfolio of finance facilities obtained from multiple banks and financial institutions.

The Board has authorized the terms through a Master Restructuring Agreement (MRA) and related documentation with the company's financiers.

The financial package includes several favorable terms designed to ease immediate liquidity pressures on the steel company.

All restructured facilities, including both principal amounts and markup payments, will be deferred for three years under a moratorium period.

However, pre-existing long-term facilities will see principal payments deferred for two years.

The restructuring extends over a 10-year tenor beginning from July 1, 2024, providing Amreli Steels with an extended timeline to restore financial stability.

In a significant shift in the company's debt profile, existing short-term facilities totaling approximately Rs11bn, split between Rs7.5bn in conventional financing and Rs3.5bn in Islamic financing, will be converted into long-term facilities and integrated into the restructured arrangement.

One of the most notable aspects of the agreement is the interest rate structure. The markup rate has been fixed at the Karachi Interbank Offered Rate (KIBOR) with no additional spread for the entire duration and amount of the restructuring agreement.

This represents a potentially significant cost saving for the company compared to typical commercial lending rates that include substantial spreads above KIBOR.

As part of the restructuring package, the company's sponsors have committed to injecting Rs4bn in liquidity support.

This will be achieved through direct equity injection and the strategic sale of non-core company assets, which will help generate additional working capital financing.

The announcement was made in compliance with Section 96 of the Securities Act, 2015, and Clause 5.6.1 of the Pakistan Stock Exchange Rule Book.

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