PJSC Ukrzaliznytsia additionally floated almost $ 100 million Eurobonds. Thus, this year's total Eurobond issue of the company is about $ 600 million. The maturity of the additional issue is 2024 at an effective rate of 7.292% per annum.
Today, PJSC Ukrzaliznytsia and the European Bank for Reconstruction and Development (EBRD) signed a framework agreement in the presence of the Minister of Infrastructure Vladyslav Kryklii containing that 70% of the $100 million raised will be directed to modernize the rail infrastructure of the TEN-T international transport corridors. Another 30% of the money will be spent on upgrading the traffic signaling and communication means, as well as improving the rail traffic control system.
Infrastructure Minister Vladyslav Kryklii noted that the signing of the agreement on the best terms in recent years shows the confidence of international financial institutions in the Government's policy: “Ukrzaliznytsia raises $100 million from the EBRD at the lowest in 8 years interest rate. Not only do we declare the principles of free competition and openness, but we will also soon launch an active reform in the field of rail transportation and directly at Ukrzaliznytsia. Collaboration with the EBRD is a message to other international partners that we express readiness to bring about reforms together."
“Ukrzaliznytsia introduces a balanced policy of modernization of the company, besides investing in the wagons and locomotives we invest in infrastructure development. With our EBRD partners, we have adopted a decision to partially update the TEN-T rail corridor, which accounts for about 80% of all transit freight. In addition, we are committed to updating our dispatching and communications equipment”, said Ukrzaliznytsia's Chairman of the Board, Yevhen Kravtsov. According to him, due to the introduced measures, Ukrzaliznytsia will have opportunities to handle additional transit freight, reduce the time of their passage through the territory of Ukraine and, as a result, increase the financial revenues of the company. In the near future, Ukrzaliznytsia and the EBRD plan to agree on an implementation plan for the agreement, which will determine the full list of modernization projects. “The procurement of materials will be conducted in line with the EBRD rules. This ensures the process being as transparent as possible. Tender participants may be both residents of Ukraine and non-residents. This will enable attracting a wide range of participants to the procurement. We plan to carry out all the work in 2020 on our own, for that we have both human and technical resources”, summarized Yevgeny Kravtsov.
It should be noted that in early July 2019, Ukrzaliznytsia raised financing from the international capital market for the first time after a six-year break. The coupon rate on the bond is the lowest since 2011 among quasi-sovereign borrowers from Ukraine.