Rusnano's obligations with state guarantees to be met under any scenario - Finance Ministry

MOSCOW. Nov 23 (Interfax) - Rusnano state company will meet and fulfill all of its debt obligations as secured under state guarantees, Russia's Finance Ministry has pledged.

On Tuesday, the Finance Ministry commented for the first time on Rusnano's debt situation that went public on Friday evening. First, the Moscow Exchange announced the suspension of trading in Rusnano bonds as from 5:08 pm Moscow time on Friday, November 19. Following this, the company announced that it held a meeting with creditors and major bondholders, during which they had discussed "the possible restructuring scenarios in the interests of creditors."

"It was noted that the accumulated disproportionate debt and current financial model of the company require adjustment. There is now a possibility to work out compromise options for the development of the situation that would render it possible to avoid the most negative scenarios," the state company said on Friday. Rusnano promised "to continue the process of an open and constructive dialogue with creditors and other interested parties," communicating to them "information on further measures as the legal opportunity arises to propose specific commercial parameters for changing obligations."

On Monday morning, the Moscow Exchange resumed trading in Rusnano bonds, which had been suspended, according to the platform, as per the order of the Central Bank of Russia (CBR). The CBR later announced that it had ordered the suspension of trading in Rusnano bonds after the regulator had received information on the discussion regarding the company's debt restructuring "with a narrow circle of creditors." Neither Rusnano nor the government has commented thus far.

The Finance Ministry said that, "the Russian government is currently developing mechanisms to improve the efficiency of JSC Rusnano's operations, including the company exiting the traditional project portfolio."

"None of the options being considered to improve the company's efficiency envisages failure to meet and fulfill the company's debt obligations as secured under state guarantees," the Finance Ministry said. The ministry does not mention in the commentary the fate of Rusnano's debts not secured under state guarantees.

"JSC Rusnano is continuing at this time to carry out its economic operations and meet and fulfill its obligations," the Finance Ministry said.