Sanctioned Russian state shipowner Sovcomflot has succeeded in swapping a big chunk of its Irish bonds, but still faces problems with coupon payments.
The Moscow-listed tanker and LNG carrier owner said it has replaced $377m of its $900m series due in 2023 with Russian notes, following a move in October to swap $318m of bonds maturing in 2028..
Payments under the replacement bonds will be made in Russian roubles.
Domestic ratings agency Expert RA has assigned ratings of “ruAAA” with a stable outlook on the Russian debt.
The shipowner had trouble with two Eurobond series earlier this year when its agent refused to handle coupon payments to investors.
After the swaps, there is still $121m of the Irish 2028 tranche in circulation and $112m of the 2023 series.
“Sanctions imposed on the company by the European Union and Great Britain continue to prevent it from properly fulfilling its obligations to Eurobond holders,” Sovcomflot said.
It reiterated its readiness to fulfil obligations under the Eurobonds and to take all available measures to resume coupon payments.
Work continues
“The company will inform bondholders and other interested parties of the status of work on the resumption of payments,” it added.
The 2028 coupon remains at 3.85% in Russia, with the 2023 bond paying 5.375%.
Sovcomflot missed two interest payments on its two issues this year.
The missed coupon in April was worth $8.28m on the 2028 series; the missed June payment was not specified.
The Irish notes were delisted by the Irish Stock Exchange on 12 April, which Sovcomflot said was done “without proper notification”.
On 31 December, the company had $600m of cash and cash equivalents.
