State-owned company AYSA managed to refinance a $500 million maturing bond that was due to be fully amortized next January. This is a debt placed in January 2018 by the previous government which paid interest at 6.625% per annum. To avoid this outlay, the company, advised by Daniel Marx and Daniel Marx’s Quantum consultancy and; Bank of America, Javier Timerman’s AdCap and HSBC bank have closed a settlement with creditors on these terms.
AySA offers the minimum cash payment for 35% of the bond to those creditors who have adhered to the proposal up to now.
Creditors participating in this restructuring will also be paid the accrued interest and will receive a new bond that will be amortized at 5% in November 2023, four installments of 20% in May and November 2024 and 2025, and 15% in May 2026.
Creditors who join from December 9 to 19 of the same month will receive 30% in cash, according to the prospectus of the operation.
The new bond will pay an interest rate of 7.9% per annum.
At the same time as the exchange offer, AySA requested the consent of the simple majority of the creditors to have the possibility of making use of the Extrajudicial Preventive Agreement (APE), without this constituting an event of default. For this operation it is necessary to exceed 50% of the creditors and the acceptance has been well above this percentage.
This instrument would allow the terms agreed with the majority of them to be extended to all creditors. In other words, there would be no room for “holdouts”, the minority that did not adhere to the transaction would be subject to the same conditions agreed upon by those who adhered to the exchange, albeit at less favorable conditions.
The ONs of AYSA were issued by the administration of Cambiemos, on February 1, 2018, at a fixed annual nominal interest rate of 6.625%.
AYSA can extend this deadline through several transactions which include an exchange of current ONs for new ones.
The Government, through the Ministry of Public Works, has established that “the necessary passive management could consist of an offer of exchange, a request for assent or a combination of both, together with the possibility of using mechanisms that allow for obtaining a higher percentage of acceptance, including the exploitation of a preventive out-of-court agreement, aimed at holders of negotiable bonds”.
Creditors will receive an exchange ratio – applied to the original amount of the outstanding bond minus the cash payment to be received – of 99.75%, while those who do not give it will have an exchange ratio of 99%, explains the brochure official. the program.
A group of creditors holding approximately 80% of the bond had already advanced their support for the Exchange Offer and the Consent.
Source: Clarin
