OREANDA-NEWS. February 19, 2010. Baby food producer Nutritek has completed the restructure of its debt commitments by signing an agreement with its last remaining lender, Rosselkhozbank, whom it owes EUR 2.4 million and RUB 110 million. According to the accord between the companies, the FX-denominated part of the loan is to be converted into rubles. The interest rate on both the FX and ruble portion of the loan is 17% per year. The loan is to be repaid on 30 June 2013.

Nutritek’s total debt now exceeds USD 200 million. The agreement with Rosselkhozbank means that the company has almost fully restructured its debt commitments to lending banks. In addition to loans, Nutritek has partially rescheduled its bond liabilities. We are upbeat on the news: in our opinion, the agreement with Rosselkhozbank has enabled Nutritek to improve its debt structure and reduce the risk of default, which was previously inherent to investors’ valuations of the company. At the same time, we still project Nutritek to post a RAS net loss of up to RUB 47 million in 2009. Weak financial performances, coupled with the recent delisting of company shares from trading floors and low information transparency (the company has not published IFRS statements since 2008), are unlikely to add to the appeal of its securities in the foreseeable future. Of course, the present news should buoy up the attractiveness of Nutritek stock, but, in view of the above factors, is unlikely to have any notable upside impact on its share prices.