RUSNANO Increases Bond Program by RUB 50 BLN
On February 14, the Board of Directors of JSC RUSNANO confirmed their decision to increase the Series 002P bond program from RUB 20 to 70 bln. The final maturity date of these bonds is 10 years. The higher bond program will not affect JSC RUSNANO’s debt levels.
The company only plans to issue the bonds in favorable market conditions in order to refinance its current loans and to reduce the rate of interest on the debt portfolio. RUSNANO expects to sell most of the additional bonds in 2020 to a wide range of investors, the first sale is scheduled for Q1 2020. The terms of the bond offering and its size will depend on when the bonds are issued.
Artur Galstyan, RUSNANO Managing Company’s Chief Financial Officer, said: “Last year, we witnessed that investors showed a good appetite for JSC RUSNANO’s unsecured bonds. In fact, we managed to sell almost all the bonds we had planned to issue. Owing to the company’s high credit rating and the ongoing trend towards lower interest rates, we see an opportunity here to refinance our loans with particularly high interest rates and to, therefore, reduce the weighted average interest rate on our debt. If the additional bonds are successfully issued, we expect to save up to RUB 1.5 bln a year from managing our debt more effectively.”
Initially, the Board of Directors of JSC RUSNANO approved a bond program of RUB 20 bln in March 2019. As part of this plan, there were 3 bond offerings amounting to RUB 18 bln in total on the Moscow Exchange. The successful primary securities issuance meant higher secondary market liquidity for the company’s bonds. In fact, in October 2019, JSC RUSNANO sold RUB 12 bln worth of bonds (with a final maturity date of 3 years) at a record low yield of 7.7%, and the number of applications to purchase the bonds exceeded the quantity of bonds first issued five-fold. For this particular issue, the secondary market has seen a stable, high turnover ratio for the bonds.
RUSNANO Joint-Stock Company was founded in March 2011 through reorganization of state corporation Russian Corporation of Nanotechnologies. JSC RUSNANO contributes to implementation of the state policy on the development of the nanotechnology industry by investing directly and through investment funds of nanotechnology in financially effective high-technology projects providing the development of new production facilities in the Russian Federation. Its primary investment focus is in electronics, optoelectronics and telecommunications, healthcare and biotechnology, metallurgy and metalwork, energy, mechanical engineering and instrument making, construction and industrial materials, chemicals and petrochemicals. 100 percent of RUSNANO’s shares are state owned. Thanks to RUSNANO’s investments, there are currently 115 factories and R&D Centers opened in 37 regions in Russia. JSC RUSNANO has profit for the last 5 years.
Management of assets of RUSNANO JSC is carried out by Limited Liability Company established in December 2013, RUSNANO Management Company. Anatoly Chubais is the Chairman of its Executive Board.
Work to establish nanotechnology infrastructure and carry out educational programs is fulfilled by RUSNANO’s Fund for Infrastructure and Educational Programs, which was also established during the reorganization of the Russian Corporation of Nanotechnologies.