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SIBUR raises USD500 million in 5-year Eurobonds

July 02/2020

MOSCOW (MRC) -- SIBUR Holding, Russia’s largest integrated petrochemicals company, announced today that it has raised USD500 million following the offering of 5-year Eurobonds on the Irish Stock Exchange, said Chemweek.

The coupon rate is 2.95%, which is a record low for Russian corporate issuers. The coupon will be paid twice a year. The Eurobond proceeds will be used to optimize the company’s loan portfolio and for general corporate purposes.
Bank GPB International, Citigroup Global Markets, Goldman Sachs International, J.P. Morgan Securities and VTB Capital acted as the leading coordinators and bookrunners. The order book topped USD1 billion. The Eurobonds were sold to 94 investors and the issue was rated Baa3 by Moody’s and BBB- by Fitch.
“The resilience of Sibur’s business and its growth potential are highly valued by investors, which is confirmed by the reaffirmation of the company’s investment-grade credit ratings from the three leading agencies. The record low coupon rate at which the Eurobonds were offered testifies to investors’ confidence in Sibur as a high-quality borrower," said Alexander Petrov, CFO.

As MRC informed earlier, in February 2020, Linde PLC recieved a contract to provide technology for PJSC SIBUR Holding’s cracker at Amur gas chemical complex (GCC). GCC is an integrated 1.5 million tons per year polyethylene and polypropylene production complex to be built near Svobodny in Russia’s far-east Amur region. The contract was awarded to Linde under a consortium with SIBUR subsidiary and project contractor NIPIgazpererabota (Nipigaz).

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 721,290 tonnes in the first four month of 2020, up by 4% year on year. Low density polyethylene (LDPE) and linear low density polyethylene (LLDPE) shipments grew partially because of the increased capacity utilisation at ZapSibNeftekhim.  At the same time, PP shipments to the Russian market totalled 347,440 tonnes in January-April 2020 (calculated by the formula production minus export plus import). Supply exclusively of PP random copolymer increased.

SIBUR is the largest integrated petrochemicals company in Russia. The Group sells its petrochemical products on the Russian and international markets in two business segments: Olefins & Polyolefins (polypropylene, polyethylene, BOPP films, etc.) Plastics, Elastomers & Intermediates (synthetic rubbers, EPS, PET, etc.). SIBUR’s petrochemicals business utilises mainly own feedstock, which is produced by the Midstream segment using by-products purchased from oil and gas companies. More than 26,000 employees working in SIBUR contribute to the success of customers engaged in the chemical, fast moving consumer goods (FMCG), automotive, construction, energy and other industries in 80 countries worldwide. In 2018, SIBUR reported revenue of USD 9.1 billion and adjusted EBITDA of USD 3.3 billion.
Author:Anna Larionova
Tags:petroleum products, crude oil, PP, PE, petrochemistry, Sibur Holding.
Category:General News
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