The Finance Ministry opposed Aeroflot’s placement of perpetual (perpetual) bonds, which would allow the company to raise funds and not increase its debt burden. This was announced by a senior government official and confirmed by a source at the airline.
The department does not want the “eternal” bonds, which need to be guaranteed with budget money, turned into a massive tool to support state-owned companies, Izvestia’s interlocutors said. The press service of the Ministry of Finance said that the mass distribution of this mechanism is not supported.
The fact that Aeroflot is considering issuing perpetual bonds to stabilize its financial position was previously reported by Izvestia sources in the government and the company. The carrier could attract 15-20 billion rubles through this instrument, said a source in the credit market.
In March, Deputy Finance Minister Alexei Moiseev noted that an economic group consisting of representatives of Aeroflot, the Ministry of Transport, the Central Bank and the Ministry of Finance is working to stabilize the air carrier’s financial position. In particular, the issue of raising funds in the foreign market is being considered, he specified. Izvestia sources in the government said that the strategy included traditional bonds, perpetual bonds and the placement of preferred shares.
At the time, Aeroflot told Izvestia that the company was considering various options for financing its activities, but in connection with the already carried out share issue in 2020, their re-placement is not being discussed at the moment.
Read more in the exclusive material from Izvestia:
Debt flight: the Ministry of Finance did not like Aeroflot’s perpetual bonds