17 June 2024, Monday, 15:35 347

Ukraine and creditors fail to agree on terms of Eurobonds restructuring

Editor: Daria Zubkova

Читати українською

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Ukraine and creditors failed to agree on the terms of the restructuring of Eurobonds.

The Cabinet of Ministers announced this at the London Stock Exchange, Ukrainian News Agency reports.

On June 17, the Government of Ukraine publicly announced that from June 3 to 14, Ukraine held closed meetings with representatives of the Eurobond Holders Committee, which includes large institutional and other long-term investors who own about 20% of Ukraine's Eurobonds.

The purpose of the meetings was to discuss the terms of the restructuring of thirteen series of Eurobonds of Ukraine, which should take place by August 1, 2024, to collect feedback from the market and to agree on a structure that would be satisfactory to all parties and would allow Ukraine to achieve debt sustainability in accordance with the requirements of the IMF Program.

The conditions are proposed on the basis of the basic macroeconomic scenario of the IMF.

Ukraine's proposal is to exchange all thirteen series of Eurobonds:

- or on a series of fixed income instruments (ordinary bonds) and government derivative instruments (option 1),

- or on a series of ordinary bonds (option 2).

Derivative instruments from the option 1 will be converted into ordinary bonds with a fixed income in 2027, the face value of which will depend on the indicators of tax revenues of Ukraine and the achievement of indicators of GDP growth according to the basic forecast of the IMF.

Both options in the proposal for the restructuring of Ukraine's debt provide for a nominal reduction of the debt from 25% to 60%, depending on the pace of the country's recovery during the period of the IMF Program.

Over the coming weeks, the Government of Ukraine will consult with Eurobond holders outside the Eurobond Holders Committee and gather feedback from the wider investor community on the structure of the deal and the instruments.

An agreement with investors on the terms of restructuring is expected by August 1 of this year.

As Ukrainian News Agency earlier reported, it became known earlier that Ukraine is conducting negotiations regarding the restructuring and partial write-off of the state debt.