Pequiven Reaches Agreement With FertiNitro Project Bondholders

CARACAS, Venezuela, Nov. 22, 2011 /PRNewswire/ -- Petroquimica de Venezuela, S.A. (Pequiven) ("Pequiven") announced that following successful negotiations it has entered into a Lock-Up Agreement (the "Lock-Up Agreement") with the holders of approximately 79% in aggregate principal amount of the 8.29% Secured Bonds due 2020 issued by FertiNitro Finance Inc. in connection with the FertiNitro fertilizer project (the "Bonds"), providing for Pequiven (or an affiliate) to launch, no later than November 30, 2011, a tender offer for the Bonds.  Holders who tender on or before 5:00 p.m. on the 10th business day following the commencement of the tender offer ("Early Tender Date") shall receive for each $1,000 original principal amount of Bonds a payment in the amount of $1,049.70 ("Total Consideration") plus accrued and unpaid interest ("Accrued Interest").  Those who tender after the Early Tender Date but at or prior to 11:59 p.m. New York City time on the expiration date of the tender offer shall receive for each $1,000 original principal amount of Bonds a payment in the amount of $1,000 plus Accrued Interest.

Bondholders that tender their Bonds will be deemed (i) to waive any and all defaults or prospective defaults under the indenture and the other financing documents governing the Bonds, and (ii) to consent to certain amendments and modifications thereto, including without limitation the elimination of substantially all restrictive covenants and events of default and the release of all collateral.

Bondholders that are parties to the Lock-Up Agreement (the "Lock-Up Holders") have agreed to tender all of their Bonds on or prior to the Early Tender Date, including Bonds they subsequently acquire.  The Lock-Up Holders have further agreed they will not transfer any Bonds unless the transferee is or becomes a Lock-Up Holder as a condition to the transfer. 

Bondholders may join the Lock-Up Agreement through the Early Tender Date.

The Lock-Up Holders have also agreed not to take any action under the indenture or other financing documents which interferes with the operation of the project in the ordinary course of business, including the exercise of any rights or remedies. 

Pequiven or its affiliate's obligation to conduct and consummate the tender offer will be subject to the satisfaction of the conditions that the Lock-Up Holders comply in all material respects with their obligations under the Lock-Up Agreement, and its obligation to consummate the tender offer will be subject to the further condition that Bonds representing more than seventy-five percent (75%) of the principal amount of all Bonds outstanding have been tendered in the tender offer. 

About Pequiven

Pequiven is a corporation (sociedad anonima) organized under the laws of Venezuela and is wholly-owned by Venezuela.  Pequiven and its predecessor entity have operated for over 30 years in many aspects of the petrochemical business.  Pequiven is organized into three business units: (i) fertilizers, (ii) olefins and plastics, and (iii) industrial products.  Pequiven's fertilizer group is responsible for the production, marketing, and distribution of various fertilizer products, with a current overall installed capacity of nitrogen-based fertilizers of approximately 1.97 million metric tons per year and an expected overall installed capacity of nitrogen‑based fertilizers for 2013 of approximately 2.6 million metric tons per year.

Notice to Investors

The tender offer referred to in this press release has not yet commenced.  This press release is not an offer to purchase or the solicitation of an offer to sell with respect to the Bonds.  The solicitation and the offer to buy the Bonds will be made pursuant to an offer to purchase, a related letter of transmittal and related materials that the offeror will distribute when it commences the tender offer.  The offer to purchase, the related letter of transmittal and the other related material will contain important information that should be read carefully and considered before any decision is made with respect to the tender offer.  Free copies of the offer to purchase, the related letter of transmittal and certain other related material will be made available by the offeror.  Copies may be obtained by contacting D.F. King & Co., Inc. at (800) 829-6554.

Forward-Looking Statements

This press release contains forward-looking statements.  Pequiven may also make forward-looking statements orally from time to time.  Other than statements of historical facts, all statements that address activities, events or developments that are intended, expected, projected, believed or anticipated or that will or may occur in the future are forward-looking statements.  The expressions "will," "may," "designed to," "outlook," "foresees," "believes," "will continue," "should," "anticipates," "plans," "expects," "intends," "estimates," "projects," "positioned," "strategy," and similar expressions or the negatives thereof or other variations on these expressions, or similar terminology, or discussions of strategy, plans or intentions identify these forward-looking statements.  Because these forward-looking statements are also subject to risks and uncertainties, actual results may differ materially from the expectations expressed in the forward-looking statements.  Pequiven undertakes no obligation to update or revise these forward-looking statements to reflect subsequent events or circumstances.

These statements are based on assumptions and assessments made by Pequiven's management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate.  These forward-looking statements are subject to a number of inherent risks and uncertainties, including factors that Pequiven's management has not yet identified.  Any such forward-looking statements are not guarantees of future performance or actual results.  A number of important factors could cause actual results to differ materially from those contained in any forward-looking statements.  Forward-looking statements speak only as of the date they are made, and Pequiven does not undertake, and specifically disclaims, any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date such forward-looking statements are made. 

SOURCE Pequiven