"Nizhnekamskneftekhim" Inc, the biggest petrochemical company in Eastern Europe, officially announced its first issue of documentary coupon bonds amounting to RUR 300m.
1 November 2001, the Moscow Office of the Russian Bank "Zenith", which belongs to the ten major banks of Russia, held an official presentation of the first bonded stock issued by "Nizhnekamskneftekhim" Inc amounting to RUR 300m. Sometime earlier, 10 October 2001, the Federal Securities Commission of the Russian Federation registered the bonds issued by "Nizhnekamskneftekhim" Inc. The Organizer, Underwriter and Payment Agent of the issued bonds are "Zenith" Bank. The principal managers to place the issue are the Moscow Bank MFK and the investment company "Troika Dialog".
Let us remind you that within the recent 5-6 years, "Nizhnekamskneftekhim" Inc has gained among the commercial banks a reputation of a bona fide borrower. No precedent ever occurred that "Nizhnekamskneftekhim" Inc had refused to repay the debts or ended up with recourse to material security. Before the notorious default of 1998, the Company did not attract big loans and widely used a government financial support of the Republic of Tatarstan in the territory of which "Nizhnekamskneftekhim" Inc is located.
According to Igor Larionov, representative of "Nizhnekamskneftekhim" Inc, a comparatively small amount of the bonded stock issue for such a big company - RUR 300m - is explained by that "for the first time we resort to a such manner of financing in order to credit large-scale projects on upgrading and revamping the existing plants. If it is a success, of which an Issuer and Organizer and Payment Agent ("Zenith" Bank) have no doubt at all, we do not rule out placing our bonds in a larger amount in future. This particular project is a pilot public borrowing within the framework of a long-term investment program of "Nizhnekamskneftekhim" Inc." Answering the questions of business representatives as to the aim of the loan, Igor Larionov explained that first of all the received money would be utilized to upgrade the Company's Ethylene Complex within the framework of the program on upgrading and raising the ethylene output up to 600 000 TPA.
Placement of the coupon bonds issued by "Nizhnekamskneftekhim" Inc was effected November 6. Many Russian industrial companies and banks have acquired large bond packages of "Nizhnekamskneftekhim" Inc reputed as a safe business partner in Russia and world over.
On termination of the first coupon period, an Investor will have an opportunity to sell bonds to the Issuer (i.e., to "Nizhnekamskneftekhim" Inc) at a prenotified price. Opportunity for guaranteed selling is provided by an irrevocable offer to be published by the Issuer. An offer to buy the bonds back was published prior to the bonds placement. The revenue to the first offer (i.e., on 182th day from the beginning date of bonds placement) has been set by the Issuer at the rate of 20.3-20.5 % per annum.
The Management of "Zenith" Bank specified at the official presentation that placement of the bonds would be effected not only among legal entities. As early as of this November end, "Zenith" Bank intends to sell the bonds of "Nizhnekamskneftekhim" Inc among the population of Tatarstan, as well as in a number of other regions of Russia.
Press Service NKNK Inc.