Akfa Aluminium, an Uzbek industrial conglomerate, has selected Citigroup Inc. and JPMorgan Chase & Co. to initiate discussions with fixed-income investors regarding a potential Eurobond offering. This move comes after S&P Global Ratings recently assigned Akfa Aluminium B+/B issuer credit ratings, signifying a stable outlook. Citigroup and JPMorgan will act as joint lead managers and bookrunners for the proposed bond issuance, which would mark a significant step for the company in tapping international capital markets.
The potential Eurobond issuance is anticipated to attract interest from a broad range of international investors, given Akfa Aluminium's strong position within Uzbekistan's industrial sector. The company has been expanding its operations, including a planned $600 million factory in Kentucky, USA, focusing on aluminum products, automotive components, and parts for solar panels and windows. The first year of investment for this U.S. facility is projected to be $105 million.
Uzbekistan has been actively working to improve its investment climate, attracting global investors like Citibank and JPMorgan. The country recently issued $1 billion in local-currency sovereign bonds at a record-low rate of 12.25%, demonstrating strong investor confidence. Furthermore, Uzbekistan and the U.S. have established a joint investment platform to channel financing into key sectors of the Uzbek economy, indicating a favorable environment for companies like Akfa Aluminium seeking international capital.
This potential Eurobond offering by Akfa Aluminium would align with the broader trend of Uzbek companies and the government seeking to diversify funding sources and attract foreign capital. The strong demand for Uzbekistan's recent sovereign bonds, with nearly 50 foreign investors submitting orders totaling $1.9 billion for a $1 billion offering, suggests a positive reception for Akfa Aluminium's potential foray into the Eurobond market.
