Rusnano discussing additional financing with govt to service debt, continue operations

MOSCOW. May 3 (Interfax) - Rusnano is discussing with the government the possibility of obtaining additional financing that is required to service debt and ensure the continuity of the company's operations, the state corporation said in an explanatory note to its financial statement.

Rusnano management believes that despite the company's current assets exceeding short-term liabilities by 5.7 billion rubles at the end of 2023, the debt in the foreseeable future, including servicing costs, "may not be sufficiently secured by the company's assets, including owing to the uncertainty of forecasts for implementing them."

"Based on the assessment of the company's liquidity situation in the near foreseeable future, the company's management believes that additional financing from the shareholder would be required to fulfill obligations, including servicing debt, as well as to conduct financial and economic activities," according to the explanatory note.

Additional financing is currently under discussion, though there are currently no legally binding documents on the possibility of this financing from the shareholder, according to the document.

Accordingly, the company said that there are "substantial uncertainties that could cast significant doubt on the company's ability to continue its operations uninterruptedly."

"Meantime, if the company could obtain financing from the shareholders at the required amount, then it would be able to continue its activities uninterruptedly," the document indicates.

Rusnano, whose financial problems were the main topic on Russia's domestic bond market at the end of 2021 and beginning of 2022, once again found itself at the center of attention in early October 2023, when it warned that it was unable to meet its debt obligations with its own funds and would very likely head into bankruptcy if the government were not to intervene in order to provide liquidity to fulfill the obligations to creditors. The financial report indicated that the volume of creditors' claims, excluding interest on loans and accumulated coupon income on bonds, significantly exceeded the value of Rusnano's assets at the end of the first half of 2023, with net debt totaling 95.56 billion rubles.

Rusnano cut its debt by 28 billion rubles to 69 billion rubles in 2023, with the main part of the remaining volume secured by government guarantees, Rusnano CFO Vladislav Yunusov told Interfax in late February, clarifying that of the remaining debt of 48 billion rubles was due to bank loans.

The company at the end of April said that it had agreed with its creditor banks, namely Sovcombank, Promsvyazbank, as well as Bank Saint Petersburg, Ak Bars , and Rossiya, regarding early repayment of the debt at a discount of around 20%. Rusnano said that this would allow the company to reduce the need to restore deferred liquidity by approximately 21 billion rubles, to repay nearly all of its "historical" debt ahead of schedule, and to focus on the promising phase of the strategy.