Russia

Russia is back in the capital markets, opening books for a new dollar deal with the unusual tenor of 16 years, as well as tapping its December 2025 euro benchmark.

A flurry of Russian equity capital markets transactions have hit the market in the past fortnight, with three block trades priced and one IPO launched. After almost no Russian issuance since April 2018, many investors are keen to gain exposure to the country and sellers are taking advantage of a clear window before political volatility returns.

Fear of US sanctions kept Russian borrowers out of the market for much of 2018. Now they’re coming back, and investors would be well advised to get involved.

Roman Abramovich let a consortium of three Russia oligarchs in a £151m selldown of shares in Evraz, the London-listed Russian steel and mining company on Monday night.

Russian borrowers are returning to life as investors start to brush off sanctions risks, though issuance is still weak compared to the same time last year. Evraz hits the road for a five year dollar bond on Wednesday and Credit Bank of Moscow (CBM) came to market on Monday.

Uralkali, a Russian potash fertiliser producer, has sent out a request for proposals to lenders in a bid to raise $1bn. But bankers say that the Russian market is beset with difficulties that are delaying the few transactions in the pipeline.

Credit Bank of Moscow (CBM) opened books on Monday for its return to the dollar market, taking orders for five year loan participation notes.

An uptick in Russian equity capital markets (ECM) activity this week buoyed bankers and investors, who are hoping a freeze caused by US sanctions is thawing, write Sam Kerr and Aidan Gregory.

Oleg Tinkoff sold $150m worth of London-listed Global Depository Receipts in TCS Group Holding on, the Russian financial services company that controls Tinkoff Bank on Tuesday night.

Investors were so enthused by an offering in Norilsk Nickel, the Russian nickel and palladium mining and smelting company, on Tuesday night that bookrunners increased the sale to $550m, and the stock has continued to perform well in trading.

Credit Bank of Moscow (CBM) is going on the road to promote a dollar loan participation note, returning to its usual external funding currency after a flirtation with euros in February.

Siberian Coal Energy Co (Suek) is expected to refinance an existing $1.5bn loan and, in doing so, set the benchmark as the first big Russian loan of the year. The transaction offers a sliver of hope in a painfully barren market and will determine the depth of lenders’ appetite for Russian debt.