Lukoil Said to Sign $1.2 Billion of Loans With 12 Foreign Banks

By Denis Maternovsky

Aug. 6 (Bloomberg) -- OAO Lukoil, Russia’s second-biggest oil company, signed $1.2 billion of loans with 12 overseas banks, according to two people with knowledge of the deal.

The three-year deal makes Lukoil one of just seven Russian companies to borrow from foreign lenders this year, according to data compiled by Bloomberg. The nation’s borrowers raised $9.5 billion in foreign-currency loans in 2009, down from $46 billion in the same period last year, as Russia’s first economic contraction in a decade prompted banks to freeze lending.

Moscow-based Lukoil is paying interest of 400 basis points more than the London interbank offered rate, or Libor, for the loan, said the people, who declined to be identified before an announcement. That’s the same margin as TNK-BP Holding, Russia’s third-biggest oil producer, paid last month to borrow $600 million over three years, Bloomberg data show.

A spokesman for Lukoil in Moscow, who declined to be identified citing company policy, wouldn’t comment on the loan.

The Lukoil financing was signed late yesterday, said the people familiar with the terms. The deal is backed by the company’s export contracts, they said.

OAO Mechel, the steelmaker controlled by billionaire Igor Zyuzin, refinanced $2.6 billion last month, the biggest loan by a Russian company this year, according to Bloomberg data.

To contact the reporter on this story: Denis Maternovsky in Moscow at dmaternovsky@bloomberg.net