RZD: Eurobond issue possible in 2014 amid 120 bln ruble borrowing
MOSCOW. Oct 1 (Interfax) - Russian Railways (RZD) could issue one series of Eurobonds in 2014 given total borrowing tentatively estimated at 100 billion-120 billion rubles, a senior company official said in Moscow on Tuesday.
"For now, according to preliminary estimates, we will borrow from 100 to 120 billion rubles," RZD's deputy head of corporate finance, Pavel Ilyichev, told Interfax on the sidelines of the Russia Calling investment forum organized by VTB Capital.
"This will be a combination of infrastructure bonds and market issues. They may be ruble bonds, perhaps one issue of Eurobonds," he said.
"Neither the currency, volume, nor dates are clear yet. Pending a final version of the budget, it is too early to talk about. But most likely we will issue something, because our policy is to make a minimum of one issue [a year], to maintain our form and remain in touch from the standpoint of the ties, image and credit quality that the company has established," he said.
Vnesheconombank (VEB) has already made the decision to increase an issue of infrastructure bonds to 150 billion rubles from 100 billion rubles previously, Ilyichev said concerning RZD's plans to raise capital at the end of 2013. RZD has already placed 75 billion rubles out of the 100 billion ruble total. The remainder, including the additional 50 billion rubles, will be sold in three tranches of 25 billion rubles each in September, October and November. The bonds will have maturities varying from 15 to 25 years.
The company does not plan any other borrowing before year-end, he said. "We will pay off some things - we have one issue of ruble bonds that matures in November. We will close the year with that borrowing and, I think, will enter the new year with a certain pile of cash," Ilyichev said.
RZD's debt will amount to about 600 billion rubles as of year-end, he estimated.
The final structure of borrowing in 2014 will be clear once the company's budget appears, he said. The idea of issuing more infrastructure bonds next year remains in the discussion stage, he said.
