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SIBUR successfully closes order book exchange-traded bond placement

May 22/2020

MOSCOW (MRC) -- SIBUR Holding, Russias largest integrated petrochemicals company, has successfully closed the order book for its BO-01 and BO-02 exchange-traded bond issues, worth RUB 10 bn and RUB 5 bn, respectively, said the company.

The final semi-annual coupon rate was fixed at 5.50% per annum, which is the lowest coupon among market placements by Russian corporate issuers historically. The par value of the bonds is RUB 1,000 each. The offering price is 100% of the par value. With a coupon period of 182 days, the bonds have a tenor of 10 years and a put option after 2.5 years.

The placement enjoyed a strong interest from investors, with demand reaching around RUB 45 bn. Leading Russian public and private banks, institutional investors and asset managers, brokers and retail investors participated in the placement.

Alexander Petrov, member of the Management Board and Managing Director for Economics and Finance at SIBUR, commented: "We keep a close eye on opportunities to optimise our debt portfolio, and now see the market as favourable for rouble bond offerings, with the aim of diversifying our borrowings and reducing the weighted average rouble borrowing rate. The proceeds will be used to refinance existing debt. Strong investor appetite attests once again to SIBURs robust financial policy and our reputation as a reliable borrower, which is underpinned by high credit ratings from the leading rating agencies."

The placement was organised by Gazprombank and Sberbank CIB, with Gazprombank also acting as the placement agent. The technical listing of the bonds on the Moscow Exchange will take place on 28 May 2020, and they are expected to be included in the Level 2 List.

As MRC informed earlier,SIBUR has completed the start-up and commissioning work at key production facilities at ZapSibNeftekhim (ZapSib), its flagship petrochemical complex at Tobolsk. ZapSib in the first quarter of 2020 produced 115,000 metric tons of PP and 259,000 metric tons of PE, part of which is en route to clients and was not reflected in the sales volumes for the reporting period. Sales of PP grew by 87.3% to 243,000 metric tons and of PE by more than 100% to 132,000 metric tons. In January 2020, Sibur completed construction of its new thermoplastic elastomers production facility at Voronezh and launched trial production.

Ethylene and propylene are feedstocks for producing PE and PP.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 383,760 tonnes in the first two month of 2020, up by 14% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased due to the increased capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market were 192,760 tonnes in January-February 2020, down by 6% year on year. Homopolymer PP accounted for the main decrease in imports.
Author:Anna Larionova
Category:General News
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