Ad Hoc Group of Entre Rios Bondholders Provides Province with Proposal for Restructuring of its 8.75% Notes Due 2025
NEW YORK, Nov. 30, 2020 /PRNewswire/ -- The Ad Hoc Group of Entre Rios Bondholders (the "Group"), which includes institutional investors holding 60% of the outstanding 8.75% Notes due 2025 (the "Notes") issued by the Province of Entre Rios (the "Province"), has provided the Province with a full term sheet for a proposed restructuring of the Notes. The term sheet, which is attached as Annex A to this statement, is based upon the restructuring principles articulated by the Group in its public statement dated November 10, 2020, and is consistent with the Basic Principles for restructuring of Argentine provincial debt recently published by the Coalition of Argentine Provincial Bondholders (the "CAPB Basic Principles").
The Group's proposal offers cash flow relief designed to support the Province in meeting its near term fiscal challenges due to the impact of COVID-19. At the same time, the proposal reflects the Group's confidence in the medium term payment capacity of the Province. By tailoring the restructuring terms to the specific situation of the Province, the Group seeks to provide appropriate relief to the Province without inflicting unjustified losses on the Province's credit providers.
The Group stands ready to negotiate with the Province in good faith on the basis of the CAPB Basic Principles. Finding a consensual resolution to the current debt default is essential to facilitate a resumption of much needed investment flows to the Province and to enable restoration of the Province's access to the international capital markets. As previously stated, the Steering Committee continues to evaluate its available options, given the lack of a constructive approach from the Province to date.
ANNEX A
RESTRUCTURING OF INTERNATIONAL BONDS OF
THE PROVINCE OF ENTRE RIOS
TERM SHEET
This term sheet sets out the key commercial terms upon which the Province of Entre Rios Ad Hoc Bondholder Group (the "Group") is willing, in principle, to restructure the international bonds issued by the Province of Entre Rios (the "Transaction"). This term sheet is not exhaustive, does not constitute or imply a commitment by the Group to a restructuring transaction nor is it intended to constitute a legally binding agreement between the Province of Entre Rios and the Group. The completion of the Transaction is subject, among other things, to execution of definitive documentation and satisfaction of customary closing conditions, in each case in a form to be mutually agreed.
Transaction |
The Transaction relates to the Province of Entre Rios's U.S. $500,000,000 8.750% Notes due 2025 (the "2025 Bonds"). . Holders of the 2025 Bonds will be invited to exchange their bonds for new bonds maturing in 2027 (the "New 2027 Bonds"). |
Exchange Consideration |
Holders of 2025 Bonds who participate in the Transaction will receive at settlement, for each U.S. $1000 principal amount of 2025 Bonds tendered in the exchange, U.S. $1000 principal amount of New 2027 Bonds. |
New 2027 Bonds |
The New 2027 Bonds will be issued on, and bear interest from, the settlement date and:
|
Treatment of Accrued Interest |
Any and all accrued and unpaid interest on the 2025 Bonds as of the settlement date will be paid in full in cash on the settlement date. |
Legal Documentation for Transaction |
To be mutually agreed by the parties. |
Advisor Fees |
Province of Entre Rios to pay the reasonable fees of the Group's legal advisers at settlement. |
White & Case LLP
Erin Hershkowitz in New York
T +1 646 885 2200
E [email protected]
SOURCE White & Case LLP
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