Dost Steel reaches restructuring agreement with lenders

Embattled long-products maker Dost Steel Limited (PSX: DSL) has clinched a debt-workout deal with its banking syndicate after securing a Rs2.08 billion equity injection from two private investors, Muhabbat Khan and Zahir Khan.

A notice to the Pakistan Stock Exchange says the fresh capital, backed by the pair’s personal guarantees, unlocks a four-year repayment plan under which Dost Steel will discharge the restructured bank facilities in sixteen quarterly instalments. The new backers have already lodged an initial Rs50 million down-payment with the consortium, signalling that the agreement is now live.

The accord removes an existential cloud that has hung over the company since late 2022, when surging finance costs and erratic scrap prices pushed it to the brink of default. Dost Steel hopes the lighter debt service will free enough cash to keep its 350-ktpa Phool Nagar bar mill running while it completes a long-delayed rights issue.