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Putin Ports Grab Hurts Novorossiysk Bondholders: Russia Credit

Russia’s push to extend state control over oil shipments is hurting investors as the country’s biggest port increases its debt fivefold to fund expansion.

OAO Novorossiysk Commercial Sea Port bonds tumbled eight of the past 10 days, sending yields to the highest level over sovereign debt since May. The Black Sea terminal will request shareholder consent to borrow $1.95 billion to help finance the $2.15 billion purchase of Primorsk Port in the Baltic Sea, Novorossiysk said in an Oct. 18 statement. Once the deal is complete, OAO Transneft, the state-owned pipeline monopoly will partner with Primorsk’s shareholder, Ziyavudin Magomedov, to buy a 50.1 percent stake in Novorossiysk, the port operator said.