The EBRD is supporting the first non-bank foreign corporate bond issue on Russia’s domestic market since the onset of the credit crisis with its participation in a 13 billion rouble offering (comprised of 3 tranches of bonds) by OJSC Tele2 Saint-Petersburg.
OJSC Tele2 Saint-Petersburg is part of the country’s fourth largest mobile operator and ultimately controlled by Sweden’s Tele2 AB telecoms group <NASDAQ OMX ticker symbols TEL2 A and TEL2 B>.
The issue, which is the first under the issuer’s recently established 30 billion rouble bond programme, is aimed at diversifying the group’s source of funding, and was lead-managed by Raiffeisen Bank and VTB Capital. Ondra Partners acted as financial advisors to Tele2 AB.
The borrower is part of the Swedish-registered holding Tele2 Russia, the most recent entrant on the Russian mobile market and its only foreign operator. It holds GSM licenses in 43 regions of Russia covering 43 percent of the population. Tele2 Russia has a staff of over 3,300.
Its strategy of offering the best value mobile services in the regions where it is present gives a greater percentage of the population a chance to access affordable telephony.
“Improved communications are essential drivers of economic growth, hence the EBRD’s support for a company which is building its expansion plans on spreading through Russia’s regions”, said Alain Pilloux, the EBRD’s Managing Director for Industry, Commerce and Agribusiness.
“In addition, the Bank’s participation in this bond issue underlines the EBRD’s commitment to the development of domestic capital markets in Russia and its success should encourage other foreign-owned corporations outside the banking sector to tap this market for funds”, Mr Pilloux added.