BRASILIA, March 17 (Reuters) - Usinas Siderúrgicas de Minas Gerais SA expects to close on Thursday a loan standstill agreement with banks, in a move that should help the largest Brazilian producer of flat steel cope with fallout from a deep recession and a swelling debt burden, Valor newspaper said.
Valor said the agreement was a pre-condition for a 1 billion real ($267.64 million) capital increase approved by shareholders on Friday. A grace period would help the company avoid filing for bankruptcy protection.
Usiminas representatives did not immediately respond to a request for comment.
$1 = 3.7363 Brazilian reais Reporting by Silvio Cascione Editing by W Simon