Ukraine and the Ad Hoc Creditors' Committee agree on Indicative Heads of Terms for restructuring of sovereign and sovereign guaranteed Eurobonds
Kyiv / London, 27 August 2015: Ukraine and the
Ad Hoc Creditors' Committee ("AHC"), which comprises Franklin
Advisers, Inc., BTG Pactual Europe LLP, TCW Investment
Management Company and T. Rowe Price Associates, Inc., have agreed on
Indicative Heads of Terms ("IHT") for the restructuring of 14
sovereign and sovereign-guaranteed Eurobonds for an outstanding principal of c.
US$ 18 bn. This perimeter includes all eleven outstanding sovereign Eurobonds
of Ukraine and three sovereign guaranteed Eurobonds of FinInPro.
Both Ukraine and
the AHC are pleased that a consensus on the best way forward for Ukraine has
been found and look forward to working together to ensure the rapid
implementation of the deal.
This agreement will allow Ukraine to fulfil, thanks to the collaboration of its most significant creditors, a key
element of the implementation of the IMF-supported Extended Fund Facility
(“EFF”) agreed in March 2015.
“This agreement is a very important milestone
for Ukraine. It is the outcome of negotiations that were difficult but
conducted in good faith. Ukraine gets a very immediate and very significant
debt reduction worth up to US$3.6 bn while maintaining its
status in capital markets, a significant plus for our economy and our banking
system. We get some US$11.5 bn financing for our
IMF-supported Program, giving us the necessary financial breathing space.
Importantly, we align our interests with our creditors. I call on all
bondholders to support this operation", announced Minister of Finance of
Ukraine Natalie Jaresko.
Igor Hordiyevych of BTG Pactual, Michael Hasenstab of Franklin Advisers, Penny Foley of TCW and Mike Conelius of T Rowe Price, representing the Ad Hoc Creditors' Committee, said:
“As long-term investors
in Ukraine, we are pleased that terms have been agreed that will allow Ukraine
to maintain its access to capital markets and provide the stable economic
platform that will help the country to restore growth.
This agreement is
confirmation of the private sector’s confidence and belief in Ukraine and our
willingness to invest in its future recovery. The Committee echoes the
Minister’s call for bondholders to support the deal and urges the official
sector to follow its lead by providing Ukraine with non-debt support in the
form of grants.”
A complete list of preliminary terms and other
information can be found on the website of the Ministry of Finance
www.minfin.gov.ua