Download Baltika Breweries pays off first bond issue On November 20, 2007

Baltika Breweries pays off first bond issue
On November 20, 2007 Baltika Breweries paid off its first bond issue.
Bonds with a total nominal value of 1 billion rubles were initially placed on October 26, 2004.
The period when the bonds were in circulation came to 3 years (1,120 days). Under the terms of
the bond issue, there was provision for payment of seven coupons. The first coupon period was
equal to 28 days and the size of the first coupon amounted to 4.00% annual interest. All the
following coupon periods were semiannual with a coupon rate of 8.75% interest per annum.
The primary (technical) placement of the bonds took place under closed subscription in favour of
Raiffeisenbank Austria, CJSC.
The secondary placement of bonds among investors took place on November 23, 2004 on the
Moscow Interbank Currency Exchange (MICEX). This was the first time that the Company
distributed bonds among investors on the Russian bond market at the issuer’s discretion – by
allocation - a widely practiced principle in Western financial markets. The unique structure of
the loan made it possible to relieve investors of the risk of change in interest rates between the
period of the initial placement and registration of the results of the issue: the securities were
offered to investors only on the secondary market. As a result, the Company received a better
price for the placement and ensured that the loan enjoyed high liquidity and wide distribution.
The average weighted income from the secondary placement amounted to 8.99% annual interest
to payback. The general demand for the Baltika Breweries bonds exceeded the size of the issue
by more than three times and amounted to 3.1 billion rubles.
The funds received from placement of the Bonds were used by the Company to finance its
activities and implement investment projects.
The organiser and underwriter of the bond issue was Raiffeisenbank Austria, CJSC. The coorganisers of the issue were: ABN AMRO Bank, Evrofinans-Mosnarbank, Promyshlennostroitelny Bank of St Petersburg (since July 2007, Bank VTB Severo-Zapad, OJSC), and Troyka
Dialog investment company.
Baltika Breweries is the largest FMCG producer in Russia. Ever since 1996, it has been the
leader on the Russian beer market. The Baltika brand holds second place in terms of sales within
Europe. The Company has 11 breweries across all of Russia and a wide portfolio of brands. It
has around 12, 000 employees.