The Rosneft Board of Directors has approved a program for the placement of exchange-traded bonds of the 004P series at 1.115 trillion rubles. The program is indefinite. According to the press service of the company, the maximum maturity of the bonds to be issued under the program is about 10 years.
Approval of the loan program does not mean a one-time debit of the entire program limit, but gives Rosneft a flexible approach to entering the market, depending on demand and market conditions at a given point in time. Rosneft announced.
“The actual placement of new bond issuances under the program will take place in accordance with the company’s approved business plan,” a company representative said.
The bond program is a universal tool that allows you to place bonds in rubles, as well as in various currencies allowed on the Moscow Exchange. It can also be the Chinese yuan or other currencies of friendly countries. Currency bond programs have been used by Rosneft as an effective tool for raising funds since 2016.
At the same time, since the launch of the last program, the oil company has issued 20 bonds (one of which is Eurobonds), totaling about 1.1 trillion rubles.
Raising funds through the issuance and subsequent redemption of bonds is an ongoing process essential to the effective financial management of any large company, including active investment activities.
Rosneft is Russia’s largest taxpayer and runs large-scale infrastructure projects. Investments in the company’s new projects give the Russian economy a multi-multiplier effect, which is key to stimulating the country’s economic growth. At the same time, Rosneft is the first oil company in Russia to receive the highest credit ratings from two leading local credit rating agencies, ACRA and Expert RA. One of the main advantages of the company is the company’s low debt load and high asset liquidity.
Expert RA states that, taking into account cash balance and confirmed limits on lines of credit, projected operating cash flow more than covers repayment and debt servicing, capital expenditures and dividend costs. Thus, the debt burden will remain at a comfortable level for Rosneft.