City of Kyiv gets $300m bond restructured, extends deadline for $250m bond

The holders of USD 300 mln in Eurobonds of City of Kyiv (CITKIE) maturing in July 2016 accepted an offer to exchange them into a set of government bonds (UKRAIN) and GDP warrants, the city reported on Dec. 8. The holders of 91.8% of the bonds outstanding submitted their response to the offer and 99% of them voted in favor of the exchange. For this bond issue to be fully exchanged into a set of new securities, an extraordinary resolution should have been passed on Dec. 8, with a quorum of 2/3 and minimum approval rate of 3/4. This resolution has been passed, which means all the bonds will be exchanged into new paper. Those approving the deal will receive USD 39.0 in sovereign bonds maturing in 2019, USD 39.0 in sovereign bonds maturing in 2020 and USD 25 in GDP warrants for each USD 100 in par value of the existing CITKIE notes. Those who did not support the deal will receive the same set of government Eurobonds and USD 23 in GDP warrants. The settlement date for the notes will be close to Dec. 22.

Meanwhile, only 57.1% of the holders of the city’s other bond (USD 250 mln due in November 2015) sent their participation instructions as of Dec. 8. The city reported it extended the deadline to send the instructions until Dec. 16. With respect to these notes, there is no quorum to approve the exchange, and the city will exchange them into a set of government Eurobonds and GDP-linked securities only for those who submit their instructions by the deadline. USD 100 in the existing notes will be exchanged into about USD 39.5 in Ukraine’s 2019 notes, USD 39.5 in Ukraine’s 2020 notes and USD 25 in GDP warrants.

Alexander Paraschiy: Recall, earlier the group of bondholders that have 38% in its 2015 notes and 22% in the city’s 2016 notes announced that they do not agree with the offered restructuring conditions. The vote on the 2016 notes revealed that at least half of such holders have accepted the city’s offer. Therefore, we expect that number of bondholders who will accept the exchange offer for the city’s 2015 notes will increase by the Dec. 16 deadline too.

Источник: Конкорд Капитал