Gazprom is poised to borrow the biggest loan in Russia’s history as it prepares to buy Yukos’s main production unit Yuganskneftegaz. The state-owned energy concern is in talks with a number of banks to borrow $10 billion to finance its purchase, according to a senior manager at one of the banks involved.
Deutsche Bank is said to be the organizer of the syndicated loan deal that will be shared with five other banks, ABN Amro, BNP Paribas, Calyon, Dresdner Kleinwort Wasserstein and JP Morgan. Each bank will make a $1.67 billion loan.
The loan will be a bridge transaction, due to be secured by long-term bonds or restructured under new conditions in 2005. Gazprom’s spokesman confirmed that the company was taking loans to finance the acquisition.
The Russian government has set a starting price of $ 8.6 billion for the controlling 76.8% stake of the heavily indebted Yuganskneftegas. Yuganskneftegas’ back tax bill stands at $5.1 billion.
After the purchase, Gazprom’s total debt could amount to $35-37 billion, according to Dmitry Lukashnev from Aton investment company. But for a company with a capitalization of $65.5 billion this was acceptable, he said.
Rating agency Standard and Poor’s has put Gazprom’s corporate rating, now at BB, on watch in response to the planned purchase. The agency cites uncertainties about the the Russian government’s policies towards the deal and the type of support it would offer Gazprom.
Gazprom is the largest gas producer in the world and holds a monopoly in the Russian market.