On 2 February the book was closed for subscriptions to the series 11 bond of Gazprom Neft, which has a nominal volume of RUB 10 billion and a maturity of ten years. The issue has a three-year call option.
The bookbuilding was conducted on a very tight schedule (three days). More than 60 applications were received from Russian and international investors during the marketing campaign, at coupons ranging from 8.10% to 8.75%. The pricing level was moved down twice on closing date. The final coupon was 8.25%, giving a yield to maturity of 8.42%.
Settlement will be on 7 February 2012.
The placing was handled by VTB Capital and Gazprombank.
“This transaction was the first market placing by a corporate borrower in 2012 and aroused great interest in the investment community. The total level of demand for Gazprom Neft securities exceeded RUB 27 billion, making it almost three times oversubscribed. One of the key factors behind the success was choosing the right time to come to market, which allowed us to place the issue at a discount to the yield curve for top-rated borrowers with comparable duration,” said Alexei Yankevich, Acting Deputy Financial Director.
On 20 October, 2011 Gazprom NeftBoard of Directors decided to place and approved the issuing documentation to register a programme of non-convertible Rouble bonds with a total nominal value of RUB 60 billion. The programme comprises 6 series (nos. 11 to 16) with ten-year duration, and the bonds are being placed by open subscription. The issues were registered with the Federal Financial Markets Service in December 2011.
Registering the Rouble bonds has given Gazprom Neft additional flexibility in funding current expenditure and capex and provides the ability to further optimise the credit portfolio.
The remaining issues will be placed depending on the company’s requirements and the state of the market. Current legislation specifies that an issue can come to market at any time within one year of registration.