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Richter plans BGS bond issue up to HUF 70 bln

Pharma

Image by Richter.hu

Hungarian pharmaceutical company Gedeon Richter announced plans to issue up to HUF 70 billion of bonds in the framework of the Bond Funding for Growth Scheme (BGS) of the National Bank of Hungary (MNB), according to a report by state news wire MTI.

Richter said late in March that its management had taken "initial steps" to participate in the BGS with the issue of a 10-year bond.

On Thursday, Richter said the issue had been assigned a BBB+ rating by Scope Ratings.

In its rating rationale, Scope Ratings said Richter planned to issue a ten-year BGS fixed-coupon bond with amortization of 10% in years 7-9 and 70% in year ten. Richter will use proceeds from the sale for "general corporate financing", it added.

Scope Ratings noted that Richter "intends to increase its dividend pay-out in the next years to avoid excess cash accumulation".

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