Kyiv city will ask the holders of its loan participation notes (LPNs) worth $300 million due in 2016 to vote in favor of the exchange of the notes to Ukraine's sovereign bonds due in 2019-2020 and GDP-linked securities at a meeting on Dec. 8 in London.
The issuer said in a report on the Irish Stock Exchange (ISE) on Monday that each $1,000 of the face value of the notes at the rate of 9.375 percent will be exchanged with Ukraine’s notes due in 2019 and 2020 at the rate of 7.75 percent and the face value of $375 and GDP-linked securities with the conventional value of $220.
According to the document, if the offer is supported, the holders of the LPNs will receive GDP-linked securities with a notional amount of $30 for each $1,000 in notes held and voted in favor of the offer.
As reported, Kyiv’s LPNs were included in the debt transaction foreseen in the IMF-supported Extended Fund Facility (EFF) program. The holders of 13 out of 14 issues of sovereign eurobonds worth a total of $14.36 billion and EUR 0.6 billion guaranteed by the state supported their restructuring on Oct. 14, 2015, no agreement was received, only with regard to the ‘Russian’ eurobonds worth $3 billion due to the creditor’s absence.
In March 2015, Kyiv City Council approved the restructuring of municipal bonds issued in 2005 and 2011 and on Nov. 6, 2015 the temporary moratorium on payments on the bonds was introduced. This concerns two issues of eurobonds worth $250 million due on Nov. 6, 2015 at the rate of 8 percent per annum and $300 million due on July 11, 2016 at the rate of 9.375 percent per annum.
The conditions of Kyiv’s eurobonds conversion approved by the Kyiv City Council on November 5 are equal to the conditions of the sovereign bonds restructuring, apart from the sum that would replace the bonds to the GDP-linked securities increased from 20 percent to 25 percent.
