Government Offers Investors Restructuring Of 13 Issues Of Ukrainian Eurobonds

(MENAFN- UkrinForm) The Cabinet of Ministers of Ukraine has offered investors the conditions for the restructuring of 13 series of Ukrainian Eurobonds, which should take place by August 1, 2024.

That's according to the Ukrainian Finance Ministry's press service , Ukrinform reports.

"Today, June 17, the government of Ukraine publicly announced that it has been in restricted discussions with members of the Steering Committee of the Ad Hoc Bondholder Committee, comprised of several major institutional asset managers and other long-term investors representing around 20% of the outstanding amount of Ukraine's Eurobonds, to test a proposal that works under the IMF baseline scenario to restructure Ukraine's outstanding Eurobonds before the current payment freeze expires on 1 August 2024. The goal has been to gather market feedback and agree on a structure, which will be acceptable to all parties and will ensure Ukraine can achieve debt sustainability in line with the IMF requirements," the statement reads.

Ukraine's proposal consisted of the exchange of the Eurobonds for either a package of fixed income instruments (the "Vanilla Bonds") and state-contingent instruments (the "SCDIs") ("Option 1") or a package of Vanilla Bonds ("Option 2"). In relation to Option 1, the SCDIs would be converted into Vanilla Bonds based on a single test in 2027 with a face value dependent upon Ukraine's performance on tax revenues, subject to meeting conditions around real GDP levels projected in the IMF's baseline scenario. As such, if the revenue test and GDP target is met, the SCDIs would be replaced by fixed-income instruments of Ukraine whose cash flows would be certain. Both options have been designed to deliver holders cash flows during the IMF program period and provide for a nominal haircut ranging between 25 and 60% depending on the country's recovery over the IMF program period.

"During the upcoming weeks, the Government of Ukraine will hold consultations with bondholders outside of the Steering Committee and gather feedback from the wider investor community around the structures and instruments that work best for investors. The agreement with investors on the conditions of the restructuring is expected to be reached by the 1st of August," the statement said.



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