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A syndicate established for AUTOVAZ bond distribution

1 March 2004
A presentation of the second offering of AVTOVAZ bonds for a total nominal value of 3 billion roubles was held on 12 February 2004.
It was declared at the presentation that an offering syndicate for issue of bonds has been established where Vneshtorgbank acts as an arranger, an underwriter and a payment agent, whereas, the Federal Securities Corporation acts as a financial advisor.
Co-arrangers of the issue are Alfa-Bank, MDM-Bank, NOMOS-Bank, Industrial and Construction Bank; co-underwriters are Moscommerzbank, Automobile Bankers House, Ingosstrakh Soyuz, Moscow Bank for Reconstruction and Development. Depository of the issue is National Depository Centre.
Rouble-denominated interest-bearing registered bonds of Series 02 issued by AVTOVAZ were registered on 14 October 2003 (official registration number 4-02-00002-А of 14 October 2003), maturity is 4.5 years (1,638 days), having 9 semi-annual coupons. The interest rate of the first coupon will be determined through an auction to distribute bonds. The rate of the 2nd coupon will be equal to the 1st coupon net of 0.5% p.a. The rate of the 3rd coupon will be equal to the rate of the 1st coupon net of 1% p.a. The Issuer will determine the rate of the remaining coupons. The terms of issue envisage put options at a 100% issue price from the par value on the payment date for the 3rd and the 6th coupons.
The second distribution of AVTOVAZ bonds at the MICEX Securities Section is to be held on 18 February 2004.
After the launch of the secondary circulation of bonds, the MICEX official marker maker syndicate envisages to maintain liquidity of the AVTOVAZ Series 02 bond secondary market through two-sided quotations having a spread at least of 0.5% out of the bond par value.
Those who wish to make acquainted with documents related to the issue and information memorandum, can do it here or on the AVTOVAZ Web-site.
For reference: AVTOVAZ is an important car producer in Eastern Europe. In 2002, the AVTOVAZ Group earned 119.4 billion roubles (under IFRS) in proceeds. In 2003, the factory produced about 700,000 cars, and exported 92,000 cars with increased deliveries of assembly sets. Under the IFRS, total assets of the Group were 139 billion roubles, and total shareholders` equity was 64 billion roubles as of 31 December 2002. AVTOVAZ paid taxes and made tax-related payments to budgetary and non-budgetary funds of all levelsounted to over 30 billion roubles.

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