Demand for Russian Eurobonds Continues
Byline: Simon Pirani
The Russian corporate Eurobond boom has life in it yet. With spreads over sovereign yield expected to tighten further, healthy demand supported by Russian investors, and investment grade not far over the horizon for the sovereign, bankers say there is room for further issuance this year. If there is a bubble anywhere, it is in the rouble bond market.Russian Eurobond issuers brought $1.9bn ([euro]1.7bn) worth of paper to the market in Q4 2002 and $2.8bn in Q1 2003. The wave crested in February with Gazprom's 10-year 9.6% Eurobond, the biggest ever from an emerging market corporate, which grew from $1bn to $1.75bn from a $6.5bn order book.
Sistema, the Moscow-based investment group, on April 3 launched a $350m, five-year Reg-S bond with a 10.4% coupon, the proceeds of which will be used to raise the group's stake in MTS, the telecoms company, by buying 10% owned by Deutsche Telekom. Last-minute fears that the bond might breach the US Securities and Exchange Commission rules meant it was available to European investors only. But it attracted a $600m order book, confirming that investors' appetite extends beyond the …
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Publication information: Article title: Demand for Russian Eurobonds Continues. Contributors: Not available. Newspaper title: Financial News. Publication date: April 27, 2003. Page number: Not available. © Not available. COPYRIGHT 2003 Gale Group.
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