At Naftogaz of Ukraine NJSC, work is underway to prepare for a new placement of Eurobonds, but the company doesn’t plan to make the final decision until autumn, Naftogaz CEO Yuriy Vitrenko confirmed in his recent interview.
“One of the few indicators showing investor perceptions of the ongoing changes in Naftogaz is quotations for our Eurobonds. What can we see? Our yields are declining. This means investors view these changes positively. We can expect quite a successful placement of our Eurobonds in the coming autumn. As autumn arrives, we will decide whether or not we still want to place Eurobonds,” said the Naftogaz CEO.
He pointed out that the company’s current quotations are roughly equal to Ukravtodor’s indicators at the time of its Eurobond placement on 17 June. “If we have look at the quotations of Naftogaz Eurobonds, they are now trading at approximately similar levels, even though we don’t have any government guarantees, unlike Ukravtodor,” noted Vitrenko.
Vitrenko also informed that funds raised through Eurobonds placement may be used by Naftogaz to optimize its loan portfolio. “This money may be needed to optimize our loan portfolio in Ukraine. We are going to replace more expensive loans with cheaper Eurobonds, provided that the situation in the stock market remains favourable. We may optimize our portfolio of Eurobonds so that their maturity could be lengthened in time, and the portfolio could feel more comfortable for the company,” said the Naftogaz CEO.
The company may also invest part of raised funds in hydrocarbon extraction and energy efficiency. “We are planning to invest, and not only in extraction, but also in other sectors such as district heating. Our investment efforts will be focused on energy efficiency. For example, this might be investments in biomass heat generation. Or investments in local heat distribution stations, which will allow housing cooperatives to more efficiently use supplied heat. We will be looking into areas that most require the company’s action to deal with national challenges,” summarized Vitrenko.
Integrated Communications Department
Naftogaz of Ukraine NJSC