Ukraine allows Naftogaz to issue USD 1 bln Eurobonds
25 October 2018
Ukraine’s Cabinet of Ministers approved on Oct. 24 a
resolution to allow Naftogaz (NAFTO) to issue international bonds for up to USD
1 bln for up to five years, local media reported the same day. Earlier this
week, Naftogaz CEO Andriy Kobolev announced that the company is planning to
raise USD 0.5-1.0 bln from a Eurobond placement.
Alexander Paraschiy: Based on
the company’s 2017 report, Naftogaz generated EBITDA of about USD 3.3 bln last
year, while its net debt amounted to just USD 1.2 bln. That means Ukraine’s
biggest natural gas company has enough room to attract a new large loan.
Naftogaz’s success will largely depend on the ability of Ukraine’s MinFin to
complete its Eurobond placement, which we expect to occur next week.
Another state-controlled company that announced a plan
to issue new Eurobonds by the end of 2018 is Ukrainian Railway (RAILUA). The
nearest deadline for any corporate issuer to complete a Eurobond placement is
Nov. 12, or 135 days after the end of the latest reporting period of 1H18. Most
likely, of the two state-controlled candidates planning to place bonds, only
Naftogaz will be able to meet this deadline, while Ukrainian Railway will have
to try to perform its placement in later periods.
