Khanty-Mansiysk – UTair (U?air Aviation, JSC) is going to float 400m rubles (about $13.8m) in promissory notes in February 2004.

In other words, in 2004 the airline company will continue its operations on the Russian domestic borrowing market.

Expanding on the company’s experience in 2003, General Director of UTair Andrey Martirosov said that UTair was the first Russian air carrier to arrange a public offering of promissory notes.

“Its success testifies to the fact that the market treats the airline company as a reliable borrower. In addition, the successful implementation of a promissory notes program is the first step towards the creation of a public credit history and, apparently, a bond placement,” Martirosov mentioned.

According to earlier reports, UTair redeemed a second issue of promissory notes for 200m rubles (about $6.9m) on December 10, 2003. The securities were issued on June 10, 2003. The initial yield of second-tranche promissory notes was 13-13.5 percent.

In addition, on October 14, the airline company redeemed second-tranche promissory notes from the first issue in the amount of 200m rubles (about $6.9m).

In mid April 2003, UTair placed the first issue of promissory notes for 300m rubles (about $10.4m) as part of its own promissory note program. The issue included two tranches – 100m rubles (about $3.5m) with a four-month maturity and 200m rubles (about $6.9m) with a six-month maturity.

Their initial yield was 14 and 14.5 percent respectively. The first tranche was redeemed on August 12, 2003.

UTair is a major operator of helicopters in the world and one of the biggest passenger carriers in Russia. As of January 1, 2004, the airline's fleet consisted of 294 aircraft, including 182 helicopters.