Russia’s Gazprom to replace a pound-denominated bond

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MOSCOW – Gazprom announced on Monday that its subsidiary Gazprom Capital will issue new ruble-denominated bonds to replace a sterling-denominated issue worth 850 million pounds ($970.02 million) due in 2024.

The original Eurobond was placed in 2017 and carried a coupon of 4.25%. The bond last traded at 51 pence the pound with a yield above 55%, unchanged on the day, with markets closed in London on Monday.

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Dollar-denominated Gazprom bonds maturing between 2026 and 2031 fell 1 to 4 cents on the day, trading at 51 cents or lower.

President Vladimir Putin signed a law in July that gives companies until the end of 2022 to issue bonds under a simplified procedure in the local market.

Proposed by the central bank, the « replacement bonds » would be a substitute for Eurobonds that Russian companies can no longer service due to sanctions over Moscow’s actions in Ukraine. ($1 = 0.8763 pounds) (Reporting by Reuters; Editing by Jan Harvey and Jonathan Oatis)