Headlines

Steelmakers taking control of insolvent plants will result in greater capacity utilisation, triggering a “steep” hike in domestic demand of graphite electrodes, according to Ravi Jhunjhunwala, chairman and managing director of HEG Ltd,  BloombergQuint reported. “A lot of steel plants have changed hands recently and a lot are likely to change hands in the near future,” Jhunjhunwala told BloombergQuint.

A consortium of banks has applied to the debt recovery tribunal in Delhi seeking to enforce personal guarantees on the promoters of Videocon group, Venugopal Dhoot and his brother Rajkumar Dhoot. Videocon owes these banks Rs 20,000 crore, The Economic Times reported. An application by the State Bank of India that ET has reviewed said it was approaching the tribunal as the Dhoots did not respond to a guarantee invocation notice sent to them. The Dhoots had promised to personally repay the banks if their companies defaulted on the loans, according to the application.

The number of insolvencies during this financial year so far is half that of the last financial year, according to statistics provided by the master of the High Court at the national consultative workshop on the insolvency bill being held at Swakopmund, The Namibian reported. Last year, 32 insolvencies were registered, which included 12 companies and 15 close corporations being liquidated, and five people being sequestrated.

Ukraine’s central bank declared insolvent Kremlin-run lender VTB’s local subsidiary on Tuesday, ending a long-running struggle over the Russian state’s role in the country after the annexation of Crimea, the Financial Times reported. The National Bank of Ukraine said it would wind down VTB Ukraine’s operations after its Moscow parent “failed to comply with banking law and the [NBU’s] regulations” and “made no attempt to keep the bank solvent”.

Rising geopolitical tensions are increasingly playing out in the global debt markets, the Financial Times reported in a commentary. Russia’s launch this week of the sale of a euro-denominated bond is just the latest example.

Asia’s corporations, which are enjoying the lowest borrowing costs from the syndicated loan market since the global financial crisis, may soon see higher rates as default risks rise, according to bankers. Surging debt delinquencies in China and India are unnerving lenders and expectations of higher funding costs for banks linked to the London interbank offering rate will prompt them to finally pass some of that onto their clients, Bloomberg News reported.

South African Airways’s suppliers are slashing payment periods to reduce the risk of losing out from a collapse of the troubled state carrier, which is struggling to pay lenders 5 billion rand ($361 million) due by the end of this month, Bloomberg News reported. Companies with contracts with SAA are cutting settlement terms to seven days from 21 days as the creditor deadline looms, interim Chief Financial Officer Deon Fredericks said in an interview in Cape Town. The National Treasury is working to facilitate the payment, with the process “well under way,” he said.

The chief executive of Germany’s Lufthansa said he expects the company to take part in more consolidation in the industry that will eventually leave three global carriers in Europe, Reuters reported. “There are way too many players in Europe,” Carsten Spohr told a meeting of the Centre for Aviation in Berlin on Tuesday, noting that six airlines had gone bankrupt in the last few months. “It is obvious that consolidation will act further and we as Lufthansa want to be part of that,” he said.

German economist Clemens Fuest described Italy as the “bigger problem, particularly in the medium term” as he claimed the impact of Brexit would be only a “short-term issue,” Daily Express reported. Italy has sent the eurozone into meltdown and the euro currency floundering after announcing its spending plans which include a deficit target of 2.4 percent for 2019. The budgetary measures enraged European Commission (EC) chiefs, who sensationally rejected the fiscal plans after claiming they breached previous spending agreements.

Cash-strapped Venezuela settled a $1.2 billion arbitration claim that will prevent a creditor from stripping away its crown jewel foreign asset, the U.S.-based Citgo Petroleum Corp refining business, according to Canadian court documents, Reuters reported. The deal with Crystallex International Corp suspends the Canadian mining company’s push for a court-ordered auction of control of Citgo as a way of collecting on an arbitration award against Venezuela that has grown to more than $1.4 billion with interest. Citgo is based in Houston, Texas.