BAKU

Azerbaijan’s state energy firm SOCAR plans to issue bonds worth $100 million on the Baku Stock Exchange (BSE) on November 1 to finance the company’s obligations.

“Subscription to new SOCAR bonds began on September 20, which will last until October 29. From November 1, we will start placing these bonds on the BSE, and on November 2 or 3, we are already planning to start operations in the secondary securities market,” Ali Agaoglu, a consultant to the state oil company on financial issues, said in an interview to the ARB24 TV channel.

He said that PSG Kapital investment company would act as a market maker in operations on the primary and secondary markets.

Agaoglu said that the maturity of the new bonds would be five years. The issue is divided into 100,000 bonds with a par value of $1,000 per security. Coupon rate – 4.5 percent per annum. Payments to bondholders will be made once a quarter.

SOCAR plans to use the funds raised from the placement of bonds to finance obligations under various projects, particularly the reconstruction of the Baku oil refinery, construction of a urea plant and others.

Azerbaijani citizens, as well as domestic and foreign legal entities registered in Azerbaijan, can subscribe to SOCAR’s bonds. The priority of sales will be given to individuals. Foreign individuals and legal entities will also be able to buy from bondholders on the secondary market.

In September 2016, SOCAR carried out the first issue of five-year bonds in the amount of $100 million on the domestic market. Applications for the company’s bonds exceeded $203.4 million.

The issue was divided into 100,000 five-year bonds with a par value of $1,000 per security. The purpose of the issue was to diversify the company’s financial channels and create new investment opportunities for the population. The bond yield was 5 percent per annum. Interest was paid every three months. The last payment was made on October 18, 2021. The bondholders received a total of $25 million in revenue.