Gazprom beginning second round of substitution for dollar-denominated 2026 bonds

MOSCOW. June 22 (Interfax) - Gazprom Capital will start an additional local bond placement on June 23 to substitute the remainder of Gazprom's dollar Eurobonds maturing in February 2026, according to the company's disclosure.

The issuer could place up to 488,120 bonds with par value of $1,000 each. The maximum volume of the additional placement totals $488.12 million, which corresponds to the remaining amount of Gazprom's outstanding 2026 Eurobonds, after the company held the first round of substitution in February this year. The coupon rate on this issue is 5.15%, and the nearest date of coupon payment is August 11. Initially, there was $1.25 billion in Eurobonds in circulation, and the company substituted 61% of the issue with local bonds during the first round.

Collection of bids for placement of the additional issue will be held from 10:00 MSK June 23 to 15:00 July 3. The placement is due to conclude on July 7 or the date of placement of the last bond. Payment for the bonds at their placement will be made in Eurobonds of the relevant issue, rights to which are accounted for by Russian depositories. Payments on substitute bonds shall be made in rubles at the exchange rate of the Central Bank of Russia (CBR) on the date of performance of obligations.

Gazprom has partially substituted all outstanding Eurobond issues with local bonds. In March, the company began to conduct the second round of Eurobond swaps. Additional placements have already been made for substitution of dollar-denominated issues maturing in March and June 2027, issues in British pounds sterling maturing in 2024 and Swiss francs maturing in 2027, as well as dollar-denominated bonds maturing in 2031 and 2034. Gazprom is now in the process of placing additional issues of dollar-denominated Eurobonds maturing in 2028 and 2029 and perpetual dollar-denominated Eurobonds.