LenSpetsSMU has fulfilled its redemption obligation for the third installment and payment of CLN interest in full and on time


On Friday, 20 November, CJSC SSMO “LenSpetsSMU” fulfilled the redemption obligation for the third installment (16.67% of the nominal) and payment of interest on credit linked notes (CLN) in full and on time. Thus, by the present moment half of the outstanding CLN’s value is extinguished.

LenSpetsSMU has decided not to exercise the call option on November, 20th, 2009.

Total consolidated indebtedness as of November 20, 2009 is $144 mil.


On 26 April 2007 Etalon-LenSpetsSMU placed credit linked notes for the amount of $100M. The maturity date according to the original terms and conditions – 26 April 2012, the put option date – 26 April 2009. Rate: 9.75%. The arranger of the issue wasROSBANK.

On 3 March 2009 LenSpetsSMU reached an agreement with the note holders on changing the parameters of the notes, in particular, on the cancellation of the put option in April 2009, prolongation of obligations till August 2010 and mitigation of the procedure of observance of financial covenants. The borrower also received the right to early redemption of the credit linked notes (call options in each installment date except the first one), which made this financial tool more flexible. For its part, LenSpetsSMU agreed to increase the rate from 9.75% to 12% per annum and to fix the redemption procedure in six equal quarterly installments starting from 20 May 2009.

The change of the parameters of credit linked notes did not require from LenSpetsSMU the granting of collateral and/or selling of shares or warrants. The note holders voted unanimously.

The arranger of the restructuring was ING Bank, the joint arranger was ROSBANK. The legal adviser of the transaction wasHerbert Smith.


Mikhail Dukhovny, Director of Corporate Communications Department
Telephone: +7 (812) 348-21-25, e-mail: dukhovny_m@lenspecsmu.ru

Victor Vasenev, Deputy CFO
Telephone: +7 (812) 348-09-95, e-mail: vasenev_v@lenspecsmu.ru