Iran Khodro, the largest car maker in the Middle East, has chosen France's BNP to advise on a credit rating and lead its bond issue, an advisor to the company said on Sunday.
Iran Khodro has said it plans to issue 300 million euros of bonds this autumn if it receives a credit rating from Fitch ratings.
"We are very hopeful that the bonds will be well received in Europe, especially now that a reputable bank is advising on it," said Behrooz Ataee, managing director of the Investment Banking Group.
The amount of the bond issue will now be subject to the level of the credit rating, Ataee added.
Iran issued sovereign debt on the European capital markets in 2002, the first since the 1979 Islamic revolution.
Iran Khodro is state-run, but has publicly traded shares on Iran's bourse. The car giant manufactured more than 450,000 cars in the year to March 2004 and has around 30,000 employees in more than 103 affiliated companies.
Iran Khodro plans to increase production to 750,000 vehicles including cars and buses in the year to March 2005.
France's Peugeot and Renault have both signed deals to make cars in Iran with Khodro.
Fitch rates Iran as B+, a sub-investment grade.