The Russian cable operator ER Telecom has issued bonds worth a total of R3 billion (€42.2 million).
ComNews reports they have a maturity of three years, with each one having a nominal value of R1,000. Generating 12.75% a year, they will see the company’s debt load become much higher than the industry average.
Funds from the bonds will be used to increase the scale of ER Telecom’s business, both through organic growth and the launch of new products, along with M&As. In total, ER Telecom has allocated up to R30 billion for this expansion.
Quoting analysts, ComNews says that there has recently been growing interest in issuing bonds by telcos in the Russian market, MegaFon, for instance, has approved one worth R80 billion.
In the case of ER Telecom, its options of obtaining a loan from a bank were limited and it had no plans for an IPO.
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