1 Jun 2010 15:06

SOCAR retains plans to place $500 mln in Eurobonds

BAKU. June 1 (Interfax) - State Oil Company of the Azerbaijani Republic (SOCAR) has not dropped plans to place $500 million in Eurobonds, Vice President Suleiman Gasymov told journalists on Tuesday.

"We retain plans to issue $500 million in Eurobonds. We continue working toward placement of Eurobonds on the market. Alongside ratings, we have IFRS financials for 2007-2009. We have also carried out an audit of reserves and are now preparing the prospectus [for the bond issue] with legal," he said.

"We have received ratings from Fitch Ratings and Moody`s, and are working with Standard & Poor's to receive a rating," he said.

He did not specify a date for the placement, but said SOCAR might place its Eurobonds before the Finance Ministry places a debut issue of sovereign Eurobonds.

"When we are ready to issue the Eurobonds, we will look at the market situation and the status of the sovereign Eurobond issue. If the Finance Ministry is ready to issue Eurobonds, we will suspend our issue in order to find out the rate we can expect. If the Finance Ministry is not ready, we might very well offer our Eurobonds," he said.

SOCAR planned to place up to $500 million in five-year Eurobonds in mid-2009, but postponed it until 2010, citing the financial crisis. SOCAR's consultant, Citibank, has said that the U.S. is the best market for the SOCAR bonds.

Azerbaijan planned to offer a debut issue of Eurobonds totaling $300 million-$500 million in 2007, but postponed the placement due to the unfavorable market.

Finance Ministry Samir Sharifov told journalists in May that the market remains unfavorable for the debut issue of sovereign Eurobonds, and that Azerbaijan is not in acute need of the placement proceeds at present.