KazTransGas has successfully placed Eurobonds
KazTransGas has successfully placed 10-year Eurobonds denominated in US dollars, with a total nominal amount of $750 million listed on the Irish Stock Exchange ("ISE") and the Kazakhstan Stock Exchange ("KASE").
The deal was a long-awaited debut of KazTransGas in the Kazakhstan and international debt capital markets. Investors have shown great interest in this placement, the global order book exceeded the offer several times. At the peak of the placement, the volume of orders reached $ 3.4 billion. Also, the placement gained great interest among investors in Kazakhstan, who, within the framework of announced trades at KASE, applied for the purchase of Eurobonds in the amount of more than $ 100 million.
During the transaction, the price guidance (YTM) was reduced from the originally announced level of 4.7% to a range of 4.5-4.6%, and then to the historical minimum level of 4.4%, which became the final rate for placement. As a comparison, in March of the current year Gazprom placed 10-year Eurobonds denominated in US dollars, with a total nominal amount of $ 750 million at a yield rate of 4.95%, which is 55 bps (basis points) higher than the rate for debut placement KazTransGas. In general, it can be noted that KazTransGas has placed its Eurobonds practically in the market yield curve of its parent company, NC KazMunayGas, which speaks of the perfectly matched time to place debt obligations with favorable conditions in the international capital market.
This issue was the second successful placement of Eurobonds from Kazakhstan in 2017. It bears reminding that earlier NC KazMunayGas made a successful placement in April of this year.
Citigroup Global Markets Limited, ING Bank N.V., London Branch, VTB Capital plc, acted as joint lead managers and joint bookrunners; and SkyBridge Invest - as Kazakhstan's leading manager at KASE. The company intends to allocate funds from the placement to repay bridge financing and for general corporate purposes.
KazTransGas is the main gas energy and gas transmission company of the Republic of Kazakhstan, representing the interests of the state on both the domestic and foreign gas markets. The company operates a centralized infrastructure for the transportation of marketable gas through main gas pipelines and gas distribution networks, provides international transit and sells gas in the domestic and foreign markets, develops, finances, builds and operates pipelines and gas storages.
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