On July 26, 2005, the Perm Motors Plant bonds worth RUR1.2 billion were fully placed.
The bonds were placed on the MICEX Stock Exchange through an open subscription with the rate of the first coupon to be auctioned.
There were 110 investors bidding for subscription. The aggregate demand at the auction reached RUR2,230.4 million. The first coupon rate was forecasted by investors at 8.0% to 13.5% p.a., with most bids ranging between 9.50% and 9.80% p.a.
The first coupon rate was set by the Issuer at 9.70 % p.a. (or 24 roubles and 18 kopeeks per bond), rates of the second to fourth coupons match the first coupon rate, rate of the remaining coupons shall be set by the Issuer. The issue provides for a put option to be exercised by the Issuer on July 27, 2006, at 100% of the nominal value.
The effective annual yield to one year put option amounted to 10.06%.
The whole issue was placed during the auction on the bond offering commencement date.
JSC Vneshtorgbank and JSC Vneshtorgbank Retail Financial Services (former GUTA-BANK) are arrangers of the issuer.
Among co-underwriters of the placement are BARS Commercial Bank, Gazenergoprombank, MDM-Bank, NOMOS-BANK, Petrocommerce Bank, the Industry and Construction Bank, SOYUZ Bank, Megatrustoil Financial Company, REGION Brokerage Company, ROSBANK, Uralvneshtorgbank, and Bank of Khanty-Mansiysk.
Underwriter and paying agent of the issue is JSC Vneshtorgbank Retail Financial Services. The Federal Stock Corporation is acting as a financial adviser, with the NDC being a depository of the issue.
Perm Motors Plant bonds are Russian Rouble denominated, documentary, interest bearing and issued to bearer with the nominal value totaling RUR1.2 billion. The issue was registered by the Federal Financial Markets Service on May 23, 2005 under State Registration No. 4-01-30190-D. Maturing in 1456 days (or 4 years), the bonds have sixteen quarterly coupons.
The rate of the first to the fourth coupons are equal and shall be auctioned at placement. Rates of the remaining coupons are to be determined by the Issuer. Under the issue documents, bond holders are entitled to an early redemption of the bonds at their nominal value in a year - on the second day of the fifth coupon period.
Perm Motors Plant plans to channel the placement proceeds into replacing more costly borrowings.
The Perm Motors Plant is a head division of the Perm Motors Group which is a leader of the Russian aviation and energy motor building.
Presently, the Perm Motors Group is controlled by the VTB Group, among its minority shareholders is an American aerospace company United Technologies Corp (UTC).
The Perm Motors Plant produces most sophisticated Russian engines such as PS-90A to power the latest long-distance planes IL-96, TU-204 and TU-214.
PS-90А engine is a most powerful Russian aviation engine of the 4th generation with a 16 thousand kgf trust. It`s a prototype of PS-90А2 engine, which meets all existing regulations on noise levels and emissions and matches foreign analogues in terms of performance.
The PS-90А2 is being developed jointly with UTC; this ensures both high technological level of the engine, and its effective promotion on international markets.
Presently, among the main users of PS-90А engine are Russian airlines, (such as Aeroflot, Dalavia, Siberia, Volga-Dnepr and others), Russian Emergency Ministry and some international airlines. Besides, engines produced by the Perm Motors Plant are installed on the IL-96-300PU airplane of President of the Russian Federation.
In the sphere of power machine building, Perm Motors Plant is a major supplier of gas and turbine units for GAZPROM and other leading Russian oil companies.
In 2004, Perm Motors produced 6 new PS-90A engines, repaired 94 aero-engines of various types and built 79 gas and turbine units of different power.
The proceeds of the Perm Motors Plant for 2004 grew almost 40% and reached RUR7.4 billion. About 43% of the proceeds resulted from manufacturing and repairing PS-90A, D-30 aero-engines and engines for MI-8 helicopters. Another 43% came from manufacturing and sale of gas and turbine unites.