The Ministry of Finance of Ukraine supports the exchange offer made by the City of Kyiv for its 2015 and 2016 eurobonds representing a total of $550 million, according to a posting on the ministry's website.
As reported, participating holders of those bonds will receive, after a 25% haircut, in equal parts, two sovereign bonds maturing in 2019 and 2020 with a 7.75% coupon and GDP growth-linked warrants for 25% of the nominal, which are fungible with warrants issued for the sovereign operation.
The Finance Ministry noted that the exchange is enabled through specific provisions in the 2015 Ukrainian budget law, therefore, it represents a time limited opportunity for City of Kyiv note holders.
Read alsoFitch downgrades Kyiv's rating to default levelAs UNIAN reported earlier, the Kyiv City State Administration proposed conducting December 8 negotiations with its noteholders to discuss restructuring of the debt.
For each $1,000 in notes held, each noteholder will be entitled to receive sovereign notes with a principal amount equal, subject to rounding, to the sum of $375 and 50% of the accrued interest on such $1,000 of notes held; and dollar denominated GDP-linked securities having a notional amount of $220.
Kyiv municipal debt was included in the perimeter of the restructuring operation, providing partial write-off and exchange for new securities under two issues of municipal notes worth $250 million maturing in November 2015 and $300 million maturing in July 2016.
On November 6, the city authorities announced a temporary moratorium on the city's external debt payments.
Ukraine and the creditors' committee reached an agreement on the restructuring of public debt, totaling $8 billion on August 27. A meeting was held with the holders of the Ukrainian eurobonds on October 14 in London, where more than 75% of the holders agreed to the restructuring terms.