Nuclear-fuel exporter Techsnabexport JSC’s plan to sign a $500 million loan with international lenders is at a standstill because of Russian sanctions, according to two people familiar with the matter.
The Moscow-based unit of Rosatom Corp., the state-run nuclear power company, is seeking a five-year facility from a group led by Deutsche Bank AG, said the people, who asked not to be identified because they’re not authorized to speak about it. Lenders sought provisions stipulating they’re repaid if Techsnabexport is sanctioned and the dispute is over whether the company can claim back banking fees in that event, the people said.
The U.S. and the European Union have imposed a wave of penalties on Russian companies, banks and its technology industry after travel bans and asset freezes aimed at President Vladimir Putin’s inner circle failed to end the conflict in Ukraine. Lending to Russian companies has slumped as banks weigh the risks of maintaining relationships in the country, with no loans in U.S. dollars, Swiss francs or euros last month, according to data compiled by Bloomberg.
Gael Gunubu, a London-based spokesman for Deutsche Bank, declined to comment on the loan. A Moscow-based spokesman for Techsnabexport, known as Tenex, couldn’t immediately comment when contacted by phone.
Tenex wasn’t targeted in sanctions imposed since July 16 that curbed access of Russia’s state-owned banks and some companies to the international capital markets. The company supplies uranium enrichment services to more than 30 utilities in 16 countries, according to its website.
VTB Group’s planned $1.5 billion loan will probably be scrapped after the U.S. sanctioned Russia’s second-biggest bank and the European Union cut off state-owned lenders from capital markets, lawyers said last week.
Banks are unlikely to risk such loans after recent penalties paid by institutions for not complying with rules, said Jonathan Fisher, a barrister specializing in financial services at Devereux Chambers in London. The U.S. extracted an $8.97 billion fine from France’s BNP Paribas SA for deals that violated sanctions against Sudan, Iran and Cuba.