Gazprom to Offer Puts on Bonds

Gazprom will offer put options for the first time on 15 billion rubles ($414 million) of bonds, giving investors the right to demand repayment before the notes come due.

The firm is seeking to boost demand for the securities by adding the put option, according to Vladimir Bragin, a fixed-income analyst at Trust Investment Bank. The sale will be in two parts later this year, Gazprom said in a statement on its web site.

"It seems that the high quality of the issuer and liquidity of the notes can no longer compensate" for a longer maturity, Bragin wrote in a research note Tuesday.

A spokesman for Gazprom was unavailable for comment.

The new issue market for ruble bonds has been all but shut to Russian companies since August as the currency declined 35 percent versus the dollar and investors shunned the securities as the economy weakened. Put options, introduced to lure investors to corporate bonds after Russia's 1998 default, have forced companies to offer investors higher returns or face redemptions.