According to Interpipe’s financial statements for the first half of 2023, the company issued a loan of $85 million at 9% to its shareholder, Victor Pinchuk. By the end of June, the company had $159 million in its accounts.
At the same time, the company’s total debt is $404 million, of which $300 million of debt are Eurobonds that must be repaid in 2026.
The head of the analytical department of Concorde Capital, Alexander Parashchiy, believes that the purpose of Pinchuk’s loan is to place excess liquidity at good interest rates (9% versus the 8.4% they pay on bonds).
The editor of the Share UA Potential resource, Taras Vinterko, in turn, explains that a loan is funds that will be returned to the company with interest. In addition, the company has financial covenants on its bonds that limit the payment of dividends, and for bondholders this is a better option than dividends.
Another positive, according to Dragon Capital senior analyst Denis Sakva, is that this loan can then be converted into dividends and there is no need to repay the loan. Moreover, if when paying dividends you need to pay tax immediately, then with a loan this can be delayed. In the future, the owner will be offset.
Interpipe General Director Andrei Korotkov stated earlier that the company is in a stable financial situation and is resuming the implementation of investment projects that were suspended since the beginning of the war.