Kazakhstan railroads do not exclude eurobonds issue in 2003 already

/REUTERS, Tashkent, Aleksey Kalmikov, May 4, 03/ - Kazakhstan railroad monopoly Kazakhstan temir zholy may at any moment make eurobonds issue, which was postponed as last year, and perspectives of coming to the market will greatly depend on the terms of coordinating of the debt deal of Russia and Kazakhstan, in which the company participates, said vice-president of Kazakhstan temir zholy Zhannat Satubaldina to Reuters. "We can start at any moment. Maybe, this year, but I would not say we are strongly preparing for the issue", - Satubaldina said to Reuters on Sunday in the lobbies of annual meeting of European bank of reconstruction and development (EBRD) in Tashkent. "Everything depends on how we will conduct negotiations on serving the letter of credit stand-by within the framework of redemption of Russia's debt for Kazakhstan in the amount of $65 m. for renting space center Baikonur", - specified the vice-president of the railway state company. According to the agreement, which was signed in 1997, Russia was to pay for the rent by goods. The scheme of Russia's debt redemption, which is examined at present, provides for participation of Kazakhstan temir zholy: the company will get in Russia a rolling-stock for $65 m. way technics and transfer similar sum to Kazakhstan budget. Money for the deal, according to Satubaldina's words, may come from eurobonds floatation. "$65 m. do not come from the sky", - she said. "In the nearest one or two years we will need them (eurobonds)", - the vice- president of the railway company added, having kept from excluding the possibility of borrowings at domestic market. One year ago Kazakhstan temir zholy interrupted preparation for eurobonds issue because of insufficient studying of investment projects, however it stated then that it did not deny plans to borrow $100-150 m. at foreign markets in 2003. Besides, in October of 2001 the company made road-show of eurobonded loan for 150 m. dollars or euros, however terrorist acts on September 11 made it postpone the issue. Since that time situation at the market became much more favorable for Kazakhstan issuers. Investors' interest in developing markets along with investments country's rating of Kazakhstan from Moody's decreased the cost of borrowings and let prolong their terms. In April the largest Kazakhstan bank Kazkommertsbank offered 10-year eurobonds for the record sum $500 m. with yield to maturity less than 9.0% APR. [2003-05-04]