Peru announces tender for existing bonds and issuance of new bonds

LIMA, Peru, June 12, 2019 /PRNewswire/ -- The Republic of Peru ("Peru") announced today an offer (the "Offer") to purchase for cash (i) outstanding U.S. Dollar-Denominated Global Bonds and Euro-Denominated Global Bonds (together, the "Global Bonds"), and (ii) sovereign bonds or bonos soberanos (the "Bonos Soberanos"), including Bonos Soberanos in the form of Global Depositary Notes previously issued by Citibank N.A. (the "GDNs", together with the Bonos Soberanos and Global Bonds, collectively, the "Bonds"), in an aggregate principal amount to be determined by Peru, in its sole discretion (the "Maximum Purchase Amount") subject to proration (if any), as described herein. HSBC Securities (USA) Inc. ("HSBC"), Morgan Stanley & Co. LLC ("Morgan Stanley"), Santander Investment Securities Inc., Scotiabank Peru S.A.A. ("Scotiabank Peru"), and Scotia Capital (USA) Inc.("Scotiabank"), will serve as the dealer managers for the Offer and Global Bondholder Services Corporation is acting as the information agent for the Offer. Scotiabank Peru is acting as billing and delivery bank for the Bonos Soberanos, Scotiabank is acting as billing and delivery bank for the GDNs, and HSBC is acting as billing and delivery bank for the Global Bonds (in such capacities, collectively, the "Billing and Delivery Banks").

The Offer is made subject to the terms and conditions set forth in the offer to purchase dated June 12, 2019 (the "Offer Document"), including the pricing and closing, in an amount and on terms and conditions acceptable to Peru, of (i) a new issuance of Peru's sol-denominated Bonos Soberanos (the "New Bonos Soberanos") and (ii) a new issuance of Peru's U.S. dollar-denominated Global Bonds (the "New Global Bonds", together with the New Bonos Soberanos, the "New Bonds").  Peru expects to announce the Maximum Purchase Amount including the Aggregate Purchase Amount of Tenders (as such terms are defined in the Offer Document) of each series of the Bonds that are accepted in the Offer and whether such series will be subject to any proration at 9:00 a.m., New York City time, on Friday, June 14, 2019. The Offer is not conditioned on any minimum participation by any series of Bonds. The aggregate principal amount of eligible U.S. Dollar-Denominated Global Bonds, Euro-Denominated Global Bonds and Bonos Soberanos (including in the form of GDNs) outstanding as of June 10, 2019 was U.S.$6,395,672,000, €2,100,000,000 and S/5,886,504,000, respectively.

This announcement does not constitute an offer to sell or the solicitation of an order to buy the New Bonds.  The New Bonos Soberanos, including in the form of GDNs, will be offered only to qualified institutional buyers in the United States in reliance on Rule 144A under the U.S. Securities Act of 1933, as amended (the "Securities Act") and to non-U.S. persons outside the United States in reliance on Regulation S under the Securities Act (collectively, "Eligible Holders"). The New Global Bonds will be offered to the public pursuant to Peru's effective registration statement.

The price payable per U.S.$1,000, €1,000 or S/1,000, as applicable, principal amount of each series of Bonds tendered by holders and accepted pursuant to the Offer (the "Purchase Price") during the Tender Period is set forth in the tables below. Holders whose Bonds are validly tendered and accepted for purchase pursuant to the Offer will also receive an amount in cash equal to any accrued and unpaid interest on their Bonds tendered and accepted for purchase ("Accrued Interest"), up to (but excluding) Thursday, June 20, 2019 (the "Settlement Date").  Payment will be made on the Settlement Date in U.S. Dollars, Euros or Soles, as applicable, as further described herein.

⁽¹⁾     These amounts may include Bonds held by institutions and companies controlled by the Peruvian Government that have not been cancelled.
⁽²⁾     Per S/1,000 principal amount of Bonos Soberanos validly tendered and accepted for purchase. Holders whose Bonds are validly tendered and accepted for purchase pursuant to the Offer will also receive Accrued Interest (as defined below).  Holders of Bonos Soberanos whose Bonds are validly tendered and accepted for purchase pursuant to the Offer will be paid in Soles and holders of GDNs whose Bonds are validly tendered and accepted for purchase pursuant to the Offer will be paid in U.S. dollars.
⁽³⁾      Reflects fees associated with the cancellation of the GDNs payable to Citibank N.A., as the depositary.
⁽⁴⁾     Issued by Citibank N.A., as the depositary, which, if accepted for purchase pursuant to the Offer, will be settled by Scotia Capital (USA) Inc. on behalf of Peru and payable in U.S. dollars as described below.

⁽¹⁾     These amounts may include Bonds held by institutions and companies controlled by the Peruvian Government that have not been cancelled.
⁽²⁾     Per €1,000 principal amount of Euro-Denominated Global Bonds validly tendered and accepted for purchase.  Holders whose Bonds are validly tendered and accepted for purchase pursuant to the Offer will also receive Accrued Interest.  Holders of Euro-Denominated Global Bonds whose Bonds are validly tendered and accepted for purchase pursuant to the Offer will be paid in Euros.
⁽³⁾        Per U.S.$1,000 principal amount of U.S. Dollar-Denominated Global Bonds validly tendered and accepted for purchase.  Holders whose Bonds are validly tendered and accepted for purchase pursuant to the Offer will also receive Accrued Interest.  Holders of U.S. Dollar-Denominated Global Bonds whose Bonds are validly tendered and accepted for purchase pursuant to the Offer will be paid in U.S. dollars.

 Each of (i) the Purchase Price of the Bonos Soberanos in the form of GDNs and (ii) the Indication of Interest Amount of Preferred Tenders for Bonos Soberanos in the form of GDNs will be calculated by converting Soles amounts to U.S. dollars, at the average rate between the bid price (compra) and the offer price (venta) of the exchange rate published by the Superintendencia de Banca, Seguros y AFP on its website (http://www.sbs.gob.pe) on the day before the Expiration Time (as defined in the Offer Document), as adjusted for three decimals.

Only Eligible Holders of Bonos Soberanos, GDNs or U.S. Dollar-Denominated Global Bonds subject to the Offer, may submit Preferred Tenders (as defined in the Offer Document) for New Bonos Soberanos, including in the form of GDNs, as applicable, as set forth in the Offer Document.

HOLDERS OF EURO-DENOMINATED GLOBAL BONDS MAY ONLY TENDER FOR CASH.

Subject to the Maximum Purchase Amount and proration, Peru expects to accept Preferred Tender Orders (as defined in the Offer Document) and Euro-Denominated Global Bonds, in each case, to the extent validly tendered at or prior to the non-preferred expiration time, before any other Non-Preferred Tender Orders (as defined in the Offer Document) are accepted in the Offer.

THE OFFER WILL COMMENCE AT OR AROUND 8:00 A.M., NEW YORK CITY TIME, ON (x) WEDNESDAY, JUNE 12, 2019.  UNLESS EXTENDED OR EARLIER TERMINATED, THIS OFFER EXPIRES AT (X) 11:00 A.M., NEW YORK CITY TIME, ON THURSDAY, JUNE 13, 2019 FOR NON-PREFERRED TENDERS (AS DEFINED IN THE OFFER DOCUMENT) AND (Y) AT 1:00 P.M., NEW YORK CITY TIME, ON THURSDAY, JUNE 13, 2019 FOR PREFERRED TENDERS.

If you hold Bonos Soberanos, you may tender such Bonds through Scotiabank Peru, and if you do not have an account with Scotiabank Peru, through another dealer manager. If you hold GDNs, you may tender such Bonds through Scotiabank, and if you do not have an account with Scotiabank, through another dealer manager. If you hold Global Bonds, you may tender such Bonds through HSBC, or its affiliates, and if you do not have an account with HSBC, through another dealer manager. You will NOT be able to submit tenders through Euroclear, Clearstream, the Depository Trust Company ("DTC") systems or CAVALI S.A. ICLV ("CAVALI"). The Billing and Delivery Banks will consolidate all tenders and accept Bonds for purchase on behalf of Peru.  Peru expects to instruct the Billing and Delivery Banks to apply a portion of the proceeds of the New Bond Offerings (as defined in the Offer Document) to acquire any Bonds validly tendered and accepted in the Offer upon the closing of the New Bond Offering.  Bonds accepted for purchase will be settled on a delivery versus-payment basis with the Billing and Delivery Banks on the Settlement Date, in accordance with customary brokerage practices for corporate fixed income securities.

If you hold Bonos Soberanos registered with CAVALI, you will not be able to tender the Bonds through CAVALI.  You must submit tenders and deliver the Bonos Soberanos, in accordance with customary brokerage practices in Peru, to Scotiabank Peru.

If you hold GDNs or U.S. Dollar-Denominated Global Bonds through DTC, they must be delivered for settlement to Scotiabank in the case of the GDNs or HSBC in the case of U.S. Dollar-Denominated Global Bonds no later than 3:00 p.m., New York City time, on the Settlement Date.  This Offer will not be eligible for the DTC Automated Tender Offer Program. 

If you hold GDNs or Global Bonds through Euroclear or Clearstream, the latest process you can use to deliver your Bonds to the applicable Billing and Delivery Bank is the overnight process, one day prior to the Settlement Date; you MAY NOT use the optional daylight process. If you hold Euro-Denominated Global Bonds, they must be delivered for settlement to HSBC no later than 12:00 p.m. (NOON), London time, on the Settlement Date.

Failure to deliver Bonds on time may result, in Peru's sole discretion, in any of the following (i) cancellation of such tenders and in such holders becoming liable for any damages resulting from that failure, and/or (ii) delivery of a buy-in notice for the purchase of such Bonds, executed in accordance with customary brokerage practices for corporate fixed income securities, and/or (iii) in the case of Preferred Tenders, (x) cancellation of such tenders and (y) in such holders remaining obligated to purchase such allocations of New Bonds in respect of the related Indications of Interest.

Holders who tender Bonds pursuant to the Offer will not have withdrawal rights with respect to the Offer.

The Offer is subject to Peru's right, at its sole discretion and subject to applicable laws to extend, terminate, withdraw, or amend the Offer at any time. Each of Peru, the Billing and Delivering Banks and the dealer managers reserve the rights, in the sole discretion of each of them, to not accept tenders for any reason.

To request offering materials, please contact the Information Agent:

Global Bondholder Services Corporation
65 Broadway – Suite 404
New York, NY 10006
United States of America
Attention:  Corporate Actions
Banks and Brokers Call:  (212) 430-3774
Toll free: (866) 470-3800
website: www.gbsc-usa.com/Peru/

The dealer managers for the Offer are:

The Billing and Delivery Banks for the Offer are:

Disclaimer

The Offer Document is not for release, publication or distribution to any person located or resident in any jurisdiction where it is unlawful to distribute the Offer Document. Persons into whose possession the Offer Document comes are required by Peru, the Dealer Managers and the Information Agent to inform themselves about, and to observe, any such restrictions.

This announcement is neither an offer to purchase nor the solicitation of an offer to sell any of the securities described herein, nor shall there be any offer or sale of such securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The Offer is made solely pursuant to the Offer Document dated the date hereof.

This announcement has been prepared on the basis that the Bonds are not being offered to the public within the meaning of Directive 2003/71/EC (as amended, the "Prospectus Directive") and the Offer is not subject to the obligation to publish a prospectus under the Prospectus Directive.

This announcement is for distribution only to persons who (i) have professional experience in matters relating to investments falling within the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the "Order")), (ii) are persons falling within Article 49(2)(a) to (d) ("high net worth companies, unincorporated associations etc.") of the Order, (iii) are persons falling within Article 43 of the Order, (iv) are outside the United Kingdom, or (v) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000) may otherwise lawfully be communicated or caused to be communicated (all such persons together being referred to as "relevant persons").  This announcement is directed only at relevant persons and must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this document relates is available only to relevant persons and will be engaged in only with relevant persons.

This announcement must be read in conjunction with the Offer Document. This announcement and the Offer Document contain important information which should be read carefully before any decision is made with respect to the Offer. If any Bond holder is in any doubt as to the action it should take, it is recommended that such holder seek its own financial and legal advice, including as to any tax consequences, immediately from its stockbroker, bank manager, attorney, accountant or other independent financial or legal adviser. None of Peru, the Dealer Managers or the Information Agent makes any recommendation as to whether Bond holders should tender Bonds in the Offer or participate in the Offer.

This announcement contains forward-looking statements and information that is necessarily subject to risks, uncertainties and assumptions. No assurance can be given that the transactions described herein will be consummated or as to the terms of any such transactions. Peru assumes no obligation to update or correct the information contained in this announcement.

SOURCE The Republic of Peru