13 Aug 2009 17:10

MOESK to announce auction on loan of 8.7 bln rubles

MOSCOW. Aug 13 (Interfax) - Moscow United Electric Grid Company (MOESK) will soon announce an open auction to select banks to provide non-renewable credit lines totaling 8.7 billion rubles, company head Yury Trofimov told journalists.

MOESK canceled an earlier tender on the loans on August 5. "We needed an open auction, not an open tender," Trofimov said. That mechanism is provided for in the legislation on natural monopolies, he added.

MOESK is working to refinance loans raised in 2009. It plans to raise funds at the auction at an interest rate of no more than 16%. Alfa Bank, from which MOESK raised a loan earlier this year at 18.7% interest, has already offered to cut the rate to 16%.

"There is the possibility of improving that parameter. We will conduct the auction," he said.

MOESK is working out its borrowing policy for 2010. "It cannot be ruled out that it will be a bond issue. We don't plan to raise new borrowing. We are renewing the loan. We will look at everything and select the option that is optimal for us," he said.

MOESK received the loan of 8.7 billion rubles from Alfa Bank in May 2009. The credit line is for two years. Later the company announced plans to raise another loan of 8.7 billion rubles and announced a tender to select banks for two credit lines: of 5.7 billion rubles and 3 billion rubles. Both of the credit lines were to have identical terms: valid for two years at no more than 16.2% annually. However, on August 5 the company canceled the tender.

MOESK, Russia's largest interregional electricity distribution company, serves consumers in Moscow and Moscow region. It is controlled by IDGC Holding.