LenSpetsSMU has placed a bonded loan in full amount totaling 2 bn rubles

23.12.2009

On 23rd December the first and the only one in 2009 deal for public placing of the bonds of the construction sector company, CJSC SSMO LenSpetsSMU, was completed. During the marketing process of the issue a three-year issue rate was reduced from 19% to 16 % per annum.

CJSC SSMO LenSpetsSMU’s bonded loan amounting 2 bn rubles has been placed for a term of three years and no offers (put options) are expected to occur. Payment of the coupons is due to be executed in quarterly installments. Redemption of the issue is due to be executed according to amortization redemption (20 % at the date of 4th, 6th, 8th, 10th and 12th coupon payment). MICEX has included the issue into the quotation list ‘B’. In the long term the bonds are planned to be included in Lombard list of the Russian Federation Central Bank. The arrangers of the issue are OJSC Alfa-Bank and OJSC Promsviazbank.

On 11 December 2009 Standard & Poor’s rating agency confirmed the rating of the issuer on the level “B” (outlook – Stable) and also assigned the credit rating ‘B’ / ‘ruA’ to the new bond issue.

Valery V. Borzilov, CFO of Etalon-LenSpetsSMU Group, shared his impressions after the financial deal: “In the initial preparation stage for the loan placing we were given the forecast rate of 19%, later – 18%. We carried out the marketing process of the issue with the range of 16-17%, but placed it at 16%. Currently, this is considered to be a great success in relation to a three-year unsecured loan in rubles. During the 2009 financial crisis we not only fulfilled all our obligations to the investors, but managed to attract more than 125 mn dollars, which were directed for the current activity financing. All these credits and loans were attracted for a period of 3-5 years and require amortization redemption meant for the possibility of their repayment from the operational cash flow.”

Chairman of the Board of Directors of Etalon-LenSpetsSMU Group, Viacheslav A. Zarenkov, stated: “Placing of that loan became the largest deal in the history of LenSpetsSMU’s debt loans in rubles. No negative events on the market (neither the crisis in Dubai, nor the volatility of foreign exchange) could interfere with that placing. I could assure our investors that by now we have reserved all resources required for our obligations fulfillment up to and including May 2010. You must admit that in 2009 not every company could tell the same about itself.”

Vice-President of Etalon-LenSpetsSMU Group, Anton V. Evdokimov, declared: “In 2009 LenSpetsSMU not only preserved its existence without anybody’s help, but made a good reserve provision for the nearest years. Financial position of the company is more stable than ever. Our credit portfolio is perfectly balanced with relation to the ruble and currency loans ratio as well as to the terms and regularity of redemption. That is precisely why we record an intense interest to LenSpetsSMU on the part of different investors.”

LenSpetsSMU expresses its sincere gratitude to the arrangers of the issue, OJSC Alfa-Bank and OJSC Promsviazbank, and also to all participants of the primary placing.

Financial officers of LenSpetsSMU in collaboration with the arrangers have already started the preparation of the bonds for circulation on the secondary market. Liquidity provision of the issue is one of the foreground tasks after the placing, because a considerable amount of investors has indicated their willingness to acquire LenSpetsSMU’s bonds after the reporting date, at the beginning of 2010.

NOTE

Public history of Etalon-LenSpetsSMU’s loans started from 2005, when the first bonded loan of CJSC CDR amounting to 1 bn rubles was placed.

No.

Issuer / Borrower

Issue

Amount

Placing date / Redemption date

1

CJSC CDR

Bonded loan series 01

1,000 million rubles

28.04.2005 / 21.02.2008

2

CJSC CDR

Bonded loan series 02

1,500 million rubles

26.07.2006 / 20.01.2010

3

CJSC SSMO LenSpetsSMU

CLN 01

100 million US dollars

26.04.2007 / 20.08.2010

4

CJSC SSMO LenSpetsSMU

Bonded loan series 01

2,000 million rubles

23.12.2009 / 07.12.2012

All in all LenSpetsSMU has successfully entered the public market of debt capital four times and thereby attracted more than 7 bn rubles.

CONTACT DETAILS

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