By Oksana Kobzeva and Gabrielle Ttrault-Farber
MOSCOW (Reuters) – Russia tapped the global debt market on Thursday for the first time this year by opening the books for two sovereign euro-denominated Eurobonds, in a bid to secure additional funding, two financial market sources said.
Moscow has been seeking additional sources of funding to make up for a budget shortfall caused by lower oil prices and the coronavirus pandemic. Russia plans to increase its public debt to nearly 19% of gross domestic product this year.
The country is placing a seven-year euro-denominated Eurobond, setting its yield guidance at around 1.25%, the sources said.
Russia’s second tranche, a 12-year Eurobond also denominated in euros, has a yield guidance of around 2%. Books are due to close later on Thursday, the sources added, with total offering size yet to be announced.
Russia last tapped the global debt market in 2019, when it raised $2.5 billion through dollar-denominated Eurobonds maturing in 2029 and 2035.
Its previous plans to raise $3 billion in Eurobonds this year were thwarted by the COVID-19 pandemic and by increased risks of Western sanctions, prompting Moscow to focus on borrowing at home instead.
The finance ministry said on Tuesday it had picked VTB Capital
VTB Capital, which has acted as sole lead manager for Russian Eurobonds in the past, had said that making a Eurobond placement in November seemed more attractive than doing so in December.
(Additional reporting by Anton Kolodyazhnyy; writing by Alexander Marrow and Gabrielle Ttrault-Farber; editing by Katya Golubkova, Larry King)
