Azerbaijan, Baku, June 3 / Trend I. Khalilova /
SOCAR (the State Oil Company of Azerbaijan) planned to issue the first bonds in 2009. SOCAR postponed its plans till improvement of situation on the world markets of capital, SOCAR vice-president on economic affairs Suleyman Gasimov said.
"Issue of bonds depends on situation on the world markets as today foreign borrowings become rather expensive, as well as bonds. Moreover, we as state structure expect for sovereign bond issue," Gasimov said.
Presently, rate varies from 8 percent and more depending on state of companies.
"We intend to orient on sovereign bond rate of the country, as well as terms and practice of companies identical with SOCAR outside Azerbaijan," Gasimov said.
Banks and companies (Gazprom, KazMunayGaz and others) continued to issue Eurobonds on the level of 2008 in the first quarter of 2009 in CIS countries as investors prefer purchase of securities, including Eurobonds, he said.
Volumes of SOCAR's Eurobonds emission preserve at announced level. But preparation operations on their issue were not held, he said. Debut issue is expected in the amount of $500 million, vice-president said. According to the international rate agencies, it is more acceptable.
Securities of the state oil company will cover five years. SOCAR's consultant on bond allocation is U.S Citibank. It suggests their allocation in the USA as there is great demand for them on U.S market. Five-six exchanges from different countries showed interest to bond allocation.
Plans on their issue for this year are connected with getting rate (contracts with two rate agencies have been signed) and conducting of the international audit within two years.
The State Oil Company held the first international audit as a result of activity in 2007. But the second will be held as a result of 2008. U.S company Miller & Land estimated reserves of hydrocarbon in SOCAR's fields. The company's report was approved by leadership of the state oil company.
Azerbaijan and its managing subjects have not realized plans on Eurobonds allocation on foreign markets. The ministry of finance has not determined with term of Eurobond allocation to $500 million. Moreover, several Azerbaijani banks actively joined this process. The International Bank of Azerbaijan announced about volumes in the amount of $200 million, Unibank - $150 million, Bank Standard - $150-200 million.
Do you have any feedback? Contact our journalist at [email protected]