Russia raises $2.5 billion with 2029 and 2035 Eurobonds
Russia raised $2.5 billion selling dollar-denominated Eurobonds maturing in 2029 and 2035 on Thursday, the finance ministry said.
The sale of Eurobonds maturing in 2029 with a yield of 3.95% raised $1.5 billion while the 2035 Eurobond, with a yield of 4.3%, raised $1 billion, the ministry said in a statement.
The initial benchmark yield on the 2029 Eurobonds was around 4% and about 4.45% for the 2035 Eurobonds, the ministry said.
The announcement comes after the rouble hit a 10-month high following dovish statements by the U.S. Federal Reserve suggesting it could cut interest rates to support the economy.
Finance Minister Anton Siluanov said this month that current market conditions were highly favourable for a placement of Russian sovereign Eurobonds.
Russia tapped the global bond market in March, raising $3 billion in a new dollar-denominated Eurobond and 750 million euros in a top-up issue of an existing euro-denominated Eurobond.
The sale's organizers were VTB Capital and Gazprombank.
Andrey Solovyev, VTB Capital's head of debt capital markets, said Russia was selling Eurobonds keeping foreign investors in focus.
Solovyev, who earlier told Reuters conditions were benign for Russia's sovereign bond placement, said demand for Thursday's Eurobonds exceeded $8 billion at its peak.
British investors bought 55% of the 2029 top-up issue. They also bought 64% of the 2035 issue, he said.
Solovyev also said that U.S. investors accounted for between 24% and 29% of buyers of Russia's Eurobonds.
As a result, Russia managed to place top-up Eurobonds with yields that roughly match their yield curve on the secondary market, he said.
"The issue of bonds at prices significantly higher than the nominal value will make it possible to send more than $140 million towards reducing the cost of servicing the Russian Federation's state foreign debt in the current year," the ministry said after the sale on Thursday.