8 October 2019 – The restructuring of Nyrstar’s balance sheet was necessitated by the financial stress being experienced by Nyrstar due to its unsustainable levels of debt. The commercial agreements entered into by Nyrstar with Trafigura were on market based terms and were not the cause of Nyrstar’s financial situation.
The restructuring involved many financial stakeholders. Trafigura and its main creditors, including 17 banks, were instrumental in aligning the interest of the various creditors of Nyrstar according to the priority of their claims on the company. The goal of this restructuring was to deliver a viable financial structure for the Nyrstar business going forward at a cost to all the creditors and stakeholders. This restructuring was recognised as being the only realistic option available to Nyrstar and the scheme was sanctioned by the UK courts on 31st July 2019, having taking into account the interests and priority of claims of all the financial stakeholders.
Without the support of Trafigura and the company’s main creditors, Nyrstar would not have continued operating as a going concern, which would have had significant economic and social impact. In fact, the agreement reached among Nyrstar’s creditors delivered a much healthier balance sheet for the company and the ability to focus on turning around its operations. The bank consortium involved in the Nyrstar restructuring praised the decisive role and actions of Trafigura, which averted major impairments of their financial exposure.
“While it’s undeniably a challenge to get Nyrstar back on track after of a period of financial instability we have the drive, expertise and financial resources to turn the company around,” said Jeremy Weir, Trafigura’s Executive Chairman and CEO. “Nyrstar is now consolidated on Trafigura’s balance sheet and will benefit from the strength and support of our banking network. Our task is to utilise the depths of technical and operational expertise in Nyrstar and to create a more reliable and efficient operation. The opportunities for combining Nyrstar’s global footprint of production across Europe, Asia and the US with Trafigura’s existing trading activities are significant, particularly in today’s relatively strong zinc market.”