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Russian Railways adds 12.5 billion roubles to seven-year Eurobond
Russian Railways continued its drive to raise 100 billion roubles ($3.2 billion) of investment capital this year by adding 12.5 billion roubles to its outstanding seven-year Eurobond issue, one of the deal’s arrangers told Reuters.The latest fundraising move, with a yield set at 8 percent, follows this week’s addition of $400 million to its outstanding ten-year issue, with a 4.05 percent yield. The original issue in March was for $1 billion with a 5.7 percent yield.
The state railways monopoly, also known as RZhD, raised 25 billion roubles from a March sale of a rouble-denominated seven-year Eurobond with an 8.3 percent yield.
Andrey Solovyov, global head of debt capital markets at VTB Capital, told Reuters that the timing was right for this week’s transactions, with the rouble deal seeing demand of more than 16 billion roubles.
“Investor interest was big from all over the world, including the United States,” he said.
Alongside VTB Capital, J.P. Morgan and Royal Bank of Scotland arranged both deals.
Russian Railways declined to comment on how it intends to use the money.
Last month French automaker Peugeot Citroen said it was in exclusive talks with Russian Railways to sell a 75 percent stake in its Gefco logistics division for 800 million euros ($1 billion).
Sources told Reuters last week that the bulk of funding for the deal is likely to come from VTB’s loan. (Reuters)
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