Regal Group International: Gazprom could turn to foreign investors for first bond sale in 16 months.

Russia’s natural gas giant may seek foreign investment because of limitations in the Ruble debt market.
 
Nov. 2, 2010 - PRLog -- Russia’s largest company, OAO Gazprom has said that it may look to foreign investors for its first bond sale in 16 months due to limitations in the ruble debt market.
The state owned company’s CEO told Regal Group International sources that the firm may issue Eurobonds as soon as this year and sell dollar debt to investors in Asia as the local bond market offered less attractive terms. Gazprom’s 2014 ruble bonds yield has climbed to 273 basis points, more than double its dollar debt due for the same year.

“Gazprom considers the international debt market a priority,” the firm’s top executive informed Regal Group International. “We don’t rule out potential Eurobond sales before the end of 2010 and plan to borrow from international capital markets in 2011.”

The majority of borrowing by the globes largest gas producer has been in dollars, to match its earnings, as gas prices are directly linked to oil products all of which are dollar denominated. Currently Gazprom and its units have $12.6 billion of dollar bonds.

“This is logical from the standpoint of avoiding currency risk, plus it is cheaper in the current conditions” to borrow abroad, an industry analyst known to Regal Group International said.  “Their primary goal is not to skew currency exposure versus revenues.”

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Regal Group International is a full service commodity trading advisory offering services to traders ranging from the beginner, with no experience in the markets at all, to the advanced trader who is looking for an avenue to place fast efficient orders.
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