Gazprom postpones Eurobond issue

The Gazprom gas holding is postponing an issue of Eurobonds. This information was released on July 26 by Andrey Kruglov, the head of the corporate financing department and a member of Gazprom's executive board, after a board meeting on Thursday. According to him, the decision to issue these securities cannot be made before the next year. The reason for this is unfavorable market environment. At the same time, the Gazprom officer pointed out that there was currently no exigency of resources; accordingly, Gazprom can afford postponing this issue and wait until the market stabilizes.

The decision to postpone the Eurobond issue was not unexpected. It seems to be brought about not only by the 'bad' market environment but also by a wish not to 'spoil' it even more when the Russian Finance Ministry is going to enter the international market.

The attraction of the 'Euroloan' by Gazprom is conditioned by the fact that a lot of Russian banks are currently forced to cut their loans to the gas giant due to exceeding the norm of crediting one borrower. According to Kruglov, though "the company has no exigency of resources", it still needs investments. Moreover, Gazprom is expecting its profits to decrease in 2002. However, one still cannot say how considerable this decrease will be. But the company's experts believe that net profits will go down by 25 percent. According to Kruglov, this is brought about by a drop in gas prices on the foreign market, the Vremya Novostey newspaper reported.

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