PROMOMED DM LLC conducted the debut placement of exchange-traded bonds for 1 billion rubles

On Wednesday, December 23, 2020, PROMOMED DM LLC successfully closed the order book for the debut issue of exchange-traded bonds on the Moscow Stock Exchange. The investors were offered securities with a total nominal value of 500 million to 1 billion rubles and a maturity of 3 years. The issue of securities aroused increased interest among market participants: demand exceeded supply by one and a half times and allowed the issue volume to increase to the upper limit of the range. According to the results of the issue, it was possible to attract 1 billion rubles, the coupon rate was 9.5% per annum.

The demand for new bonds is understandable: for the first time in the last few years, bonds of a Russian pharmaceutical company will appear on the open market, which will allow investors to diversify their portfolios with attractive fixed income instruments.

Recall that at the end of November 2020, the Expert RA rating agency assigned PROMOMED DM LLC a "ruBBB+" credit rating with a stable outlook. One of the criteria for assigning the rating was the consolidated financial statements according to IFRS standards, audited by Deloitte. Thus, the pharmaceutical company was given the opportunity to enter the open borrowing market, and on December 18, 2020, the Moscow Stock Exchange registered 3-year bonds of the issuer with a nominal value of 1,000 rubles. 001P-01 series. The issue was assigned the registration number 4B02.-01-00560- R-001P.

The coupon payment periodicity will be 182 days. The guarantor for the release is the production site of JSC Biochemik Holding (MOEX: BIOH). The issue was organized by Raiffeisenbank, co-organized by Otkritie Bank, IFC SOLID and UNIVER Capital. The technical placement of the bonds will take place on the Moscow Stock Exchange on Friday, December 25.

The PROMOMED DM investment program is focused on the development and production of active pharmaceutical substances (APIs) and ready-made dosage forms, as well as the construction of new laboratories and workshops. In the near future, the company plans to focus on the creation of innovative antiviral, antibacterial, endocrinological and oncological drugs.

The initial bond placement took place against the background of instability in stock markets caused by the global economic downturn and the spread of the coronavirus epidemic. As noted by Peter Bely, Chairman of the Board of Directors of PROMOMED, despite the unfavorable market conditions, the results of the placement turned out to be very impressive. "We set the coupon rate at 9.5%, which is comparable to the performance of the largest issuers that have long been present on the public borrowing market. This is our great achievement," he said. – It is important that the placement was absolutely market-oriented. A large number of applications were collected, including from minority shareholders, and we can count on good liquidity of our bonds in the secondary market. In the future, the company will continue to work on maintaining and improving its achievements."

PROMOMED Group is a leader in the domestic pharmaceutical industry in the production of anti-infection drugs with its own scientific and production site of JSC Biochemist in Saransk. The company's portfolio includes more than 150 names of medicines, 80% of which are included in the list of VED.