Kommersant: the government allocated 130 billion rubles to VK, Yandex and Ozon

VK, “Yandex” and Ozon received a preferential loan from the government for 130 billion rubles. Companies need this support to fulfill their obligations to Eurobond holders, writes Kommersant, citing the Ministry of Digital Development and a source close to the Cabinet of Ministers.

VK refused to confirm the amount of the soft loan, but noted that they had already sent a “request for the provision of soft loans to restructure the resulting debt.” In “Yandex” they said that they took a targeted loan from a commercial bank. The company will spend these funds on payments on Eurobonds. Yandex clarified that “subsidizing lending rates takes place within the framework of an agreement between banks and the government.” Ozon declined to answer the newspaper’s questions.

The Ministry of Digital Transformation also confirmed that the government had agreed on their initiative and “provided large Russian Internet companies (Yandex, VK and Ozon) with concessional loans to refinance the resulting debt in the amount of 130 billion rubles. in connection with the termination of trading in their securities.

It is noted that the companies issued convertible bonds: Yandex for $1.25 billion, VK for $400 million, and Ozon for $750 million. However, after the start of Russia’s special operation in Ukraine, foreign exchanges (NASDAQ, LSE) suspended trading in shares and GDRs of these companies.

When trading is suspended for more than a certain number of trading days in a row (Yandex NV – 5 trading days, Ozon Holding PLC – 7 trading days, VK Company Limited – 10 days), a “delisting event” occurs. According to a leading debt market analyst, “Opening Investments” by Alexander Shurakov, in connection with this, companies have the right to early redemption of convertible bonds.

According to him, since March-April, Internet companies have been negotiating with holders of convertible bonds on the terms of early redemption. Therefore, corporate accounts must have enough funds to pay off Eurobond holders at their first request.

According to Ekaterina Makeeva, partner of A-PRO JSB, the key point in this situation is the question of whether the payment to foreign investors in rubles will be considered a default. The expert noted that with a high probability the payment in rubles on Eurobonds will not be considered the fulfillment of obligations.

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