JSC National Company KazMunayGas’s $3.25 billion Eurobonds Offering

Dechert advised on the transaction

Dechert advised JSC National Company KazMunayGas (“KMG”), the Kazakhstan state-owned oil and gas company, on its issuance of an aggregate of US$3.25 billion Eurobonds under its US$10.5 billion Global Medium Term Notes Programme established by KMG and its finance subsidiary KazMunaiGaz Finance Sub B.V (“KMG Finance”).

The Eurobonds, which are listed on the London Stock Exchange and the Kazakhstan Stock Exchange, were issued in three series, comprising the (i) US $500,000,000 4.750% Notes due 2025; (ii) US $1,250,000,000 5.375% Notes due 2030; and (iii) US $1,500,000,000 6.375% Notes due 2048.

The net proceeds received by KMG from the issuance of the Eurobonds were used to fund the concurrent liability management transaction on which Dechert also advised, comprising tender offers and consent solicitations in respect of four series of outstanding Notes, including the inclusion of a mandatory early redemption provision.

Dechert also advised JSC Development Bank of Kazakhstan (“DBK”) on the issuance of its KZT 100,000,000,000 8.95% Notes due 2023 issued as Series 8 under its US$3.0 billion Medium Term Note Programme. The Notes are listed on the London Stock Exchange and Kazakhstan Stock Exchange. The Notes are denominated in Kazakhstan tenge and payable in U.S. Dollars.

This transaction marked the second tenge-denominated Eurobond issuance by DBK, with DBK achieving a longer maturity (up to 5 years from 3 years) and reduction of the coupon rate to 8.95% from 9.5% per annum since its debut tenge-denominated issuance in December 2017. This marked the first tenge-denominated issuance by DBK conducted pursuant to both Rule 144A and Regulation S under the U.S. Securities Act of 1933.

Dechert’s emerging markets team on these transactions was led by Dubai-based Louise Roman (Picture) and London-based partner Patrick Lyons, with additional support from associates Jennifer Rees and Amy Rees in London; and partner Victor Mokrousov and associates Yevgeniya Nossova and Bolat Utebaliyev in Dechert’s Almaty office.

 

Involved fees earner: Patrick Lyons – Dechert; Louise Roman Bernstein – Dechert; Jennifer Rees – Dechert; Amy Rees – Dechert; Victor Mokrousov – Dechert; Yevgeniya Nossova – Dechert; Bolat Utebaliyev – Dechert;

Law Firms: Dechert;

Clients: National Company KazMunayGas JSC;