On December 24, Ukraine announced the successful completion and settlement of the restructuring of government derivatives linked to GDP (GDP warrants), which was supported by 99.06% of investors.
This is stated in the message of the Ministry of Finance, the Ukrainian News agency reports.
The transaction increases budget predictability, strengthens debt sustainability and contributes to the preservation of the resources of the state budget of Ukraine in the context of the ongoing russian military aggression.
According to the terms of the restructuring, the GDP warrants in the amount of USD 2.635 billion were exchanged for new Series C bonds due 2032 in the total amount of USD 3.497 billion, and also for Series B bonds due 2030 and 2034 in the amount of USD 16,904,800 each. All GDP warrants were canceled.
This restructuring eliminates a significant risk for Ukraine's public finances. According to the Ministry of Finance, without this restructuring, the repayment of the GDP warrants in 2025-2041 could have reached USD 6 to 20 billion, depending on the economic growth rate.
The agreement facilitates the fulfillment of Ukraine's debt targets under the IMF program and meets the expectations of the Group of Official Creditors of Ukraine.
White & Case acted as a legal advisor to the Ministry of Finance and Rothschild & Co. as a financial advisor.
As the Ukrainian News agency earlier reported, Ukraine failed to make a payment on these securities in the amount of USD 665 million on June 2.
Earlier, the Ministry of Finance reported that Ukraine would not make payments on government derivatives, which amounted to USD 665.4 million as of April 30.
In August 2024, the Cabinet of Ministers decided to temporarily suspend payments on obligations under government derivatives of 2015 (GDP warrants) from May 31, 2025, until the transaction (deal) with them is completed.
In October 2015, the holders of 13 out of 14 issues of sovereign and sovereign-guaranteed Eurobonds totaling USD 14.36 billion and EUR 0.6 billion supported the restructuring.
During the restructuring, Ukraine issued GDP warrants for the amount of Eurobonds written off by creditors.
Under the terms of the issue, investors claim a share of the real GDP growth (taking into account inflation) that exceeds 3% in 2019-2038, provided that nominal GDP (excluding inflation) exceeds USD 125.4 billion.
The initiator of the issue was the then Minister of Finance of Ukraine, Natalie Jaresko.
Who we are: About us, Contacts. How we write news and our principles: Editorial code. We did our best. If you found this valuable – please support us.
To request a correction, please send an email.