Credit rating rationale. PJSC “GAZPROM” acts as a guarantor for the bonds issued by Gazprom capital LLC. The issues represent senior unsecured debt of PJSC “GAZPROM” (hereinafter – Gazprom, the Company, or Group). Due to the absence of either structural or contractual subordination of the issues, ACRA regards them as equal to other existing and future unsecured and unsubordinated debt obligations of the Company in terms of priority.
In accordance with the ACRA methodology, and taking into account high creditworthiness of the Company as well as the absence of any substantial secured debt obligations, the bond issues are rated AAA(RU), on par with the credit rating assigned to PJSC “GAZPROM”.
The credit rating assigned to PJSC “GAZPROM” is based on very high systemic importance of the entity for the Russian economy and high level of state influence according to the ACRA methodology. Standalone creditworthiness of the Company is determined by very strong business profile, low industry risk and strong financial profile. The medium leverage and debt servicing indicators as well as weak free cash flow indicators through 2018-2019 driven by substantial capital expenditures and dividend payouts have a restraining effect on the standalone creditworthiness assessment (SCA).
Key issue properties
| Borrower | PJSC “GAZPROM” |
| Issuer’s credit rating | AAA(RU), outlook Stable |
| Actual issuer | Gazprom capital LLC |
| Type of security | Exchange-traded interest-bearing certified unregistered bond, BО-01 series |
| Issue volume | RUB 5 bln |
| RegS | 4B02-01-36400-R |
| Final placement date | February 27, 2018 |
| Maturity date | February 15, 2028 |
| Borrower | PJSC “GAZPROM” |
| Issuer’s credit rating | AAA(RU), outlook Stable |
| Actual issuer | Gazprom capital LLC |
| Type of security | Exchange-traded interest-bearing certified unregistered bond, BО-02 series |
| Issue volume | RUB 5 bln |
| RegS | 4B02-02-36400-R |
| Final placement date | February 27, 2018 |
| Maturity date | February 15, 2028 |
| Borrower | PJSC “GAZPROM” |
| Issuer’s credit rating | AAA(RU), outlook Stable |
| Actual issuer | Gazprom capital LLC |
| Type of security | Exchange-traded interest-bearing certified unregistered bond, BО-03 series |
| Issue volume | RUB 10 bln |
| RegS | 4B02-03-36400-R |
| Final placement date | February 27, 2018 |
| Maturity date | February 15, 2028 |
| Borrower | PJSC “GAZPROM” |
| Issuer’s credit rating | AAA(RU), outlook Stable |
| Actual issuer | Gazprom capital LLC |
| Type of security | Exchange-traded interest-bearing certified unregistered bond, BО-04 series |
| Issue volume | RUB 10 bln |
| RegS | 4B02-04-36400-R |
| Final placement date | February 27, 2018 |
| Maturity date | February 15, 2028 |
Regulatory disclosure
The credit rating has been assigned under the national scale for the Russian Federation and is based on the Methodology for Assigning Credit Ratings to Individual Issues of Financial Instruments Under the National Scale of the Russian Federation, and the Key Concepts Used by the Analytical Credit Rating Agency within the Scope of Its Rating Activities.
The credit rating was assigned to BO-01, BO-02, BO-03, and BO-04 series bonds issued by Gazprom capital LLC for the first time. The credit rating is expected to be revised within one year following the rating action date (February 19, 2018).
The assigned credit rating is based on the data provided by PJSC “GAZPROM”, information from publicly available sources as well as ACRA’s own databases. The credit rating is solicited, and PJSC “GAZPROM” participated in its assignment.
No material discrepancies between the provided data and the data officially disclosed by PJSC “GAZPROM” in its financial statements have been discovered.
ACRA provided no additional services to PJSC “GAZPROM” and Gazprom capital LLC. No conflicts of interest were discovered in the course of credit rating assignment.
