Mar 17, 2004. /Lesprom Network/. The demand for Russian Volga bonds issue placed by auction reached RUR 2,303 billion, exceeding the issue total volume by 53%, Raiffeisen bank Austria public-affairs told Lesprom.ru. The applications filed contained interest rates ranging from 10,00% to 12,98%. 106 applications were filed. During the auction 71 applications were admitted with a total volume of RUR 1,377 billion. The bonds quoted at RUR 123 million face value were sold within 8 seconds through Moscow currency exchange trade system after the auction was over. As Lesprom.ru informed you before, Moscow currency exchange carried out an auction on March,16 to set the interest rate for Volga first half-year coupon of the first issue . The issuer set the interest rate at 12,00%. The issue organizers are Raiffeisen bank Austria and Russian Alfa-Bank. The issue underwriter is Reiffeisen bank Austria. The issue co-organizers are: Nikoil, Vneshtorgbank, Bank of Moscow, Centrocredit Bank, Petrocommerce bank, Moscow International bank, Russ-Invest. The issue financial consultant is Federal Stock-market Corporation. The issue worth RUR 1,5 billion was registered on July, 29 2003 by the Federal Commission on Securities. The bonds will remain valid for 3 years. The prospectus also envisages a call option - the right of the issuer to pay the whole interest on the day of the 3rd coupon issue at 102% of the bonds face value. According to the issue shareholders representative Ost-West Group CEO Yuli Kaloev, the funds earned by the bonds issue will be spent on the supplies of new equipment and Volga modernization. Volga (Balahninsky pulp and paper enterprise) is Russia’s largest manufacturer and exporter of newsprint and paper. The enterprise was built in 1925. The company occupies 32% of the national newsprint market and 1,4% of the international market. More than 63% of the company’s products are exported to Western and Eastern Europe, Asia and Africa. The company’s earnings were reported at RUR 6 billion in 2003. Volga majority stake is owned by Ost-West Group. Raiffeisen bank, owned by international Reiffeisen group, occupies the 13th position among Russian major assets-owning banks and is one of the leaders in Russian corporate bonds market. In 2001-2004 the bank was an organizer and co-organizer of 27 corporate bonds issues at a face value of RUR 49,5 billion. Ost West Group is a European mutual investment fund, accumulating funds from public sector and investing them in Russia. The company’s overall assets reach $300 million. Ost West Group has invested mostly in pulp and paper, timber industry and commercial real estate.