Ukraine, ad hoc committee of GDP warrant holders end talks following exchange of opinions on restructuring proposals - MinFin

MOSCOW. Nov 7 (Interfax) - Ukrainian officials held restricted discussions between October 16 and November 5 with members of the ad hoc committee of institutional holders of Ukraine's outstanding GDP-linked securities (warrants) to propose a restructuring of these instruments, Ukrainian media reported.

"The parties have jointly decided to terminate the restricted discussions without reaching final agreement on the terms of a potential restructuring of the warrants," the media quoted the Ukrainian Finance Ministry as saying in a statement.

Ukraine intends to continue engagement with holders of the warrants and consider all available options for the restructuring of the warrants, consistent with three objectives: restoring debt sustainability in line with Ukraine's IMF Extended Fund Facility Program; Ukraine's commitment made in connection with the Eurobond restructuring in August 2024 to ensure appropriate burden sharing across all commercial claims within the restructuring perimeter; and the government's moratorium approved on August 27, 2024 on payments under the warrants from and after May 31, 2025 until the completion of the restructuring of the warrants.

Ukraine was joined at the talks by its legal and financial advisors, White & Case LLP and Rothschild & Co, respectively, and the ad hoc committee was joined by its legal and financial advisors Cleary Gottlieb Steen & Hamilton LLP and PJT Partners (UK) Ltd respectively.

Ukraine's second proposed transaction consists of an exchange of warrants for a package of cash and a new series of sovereign bonds ("C Bonds"). This offer remained subject to the subsequent assessment (and approval) by both the International Monetary Fund and the Group of Creditors of Ukraine (Paris Club) for compatibility with Ukraine's commitment to restore debt sustainability and the principle of comparability of treatment with Ukraine's official bilateral creditors.

This package includes a compensation for the missed payment under the warrants in respect of the reference year 2023, which was due on June 2, 2025. No further compensation will be provided to holders of warrants with respect to this missed payment.

Consenting holders would receive $60 in cash for $1,000 notional amount of warrants.

The C Bonds would be redeemed over three equal instalments on January 30 in 2030, 2031 and 2032. Interest would be payable on the C Bonds on a semi-annual basis: 2026-2027 - 2.50%, 2028-2029 - 4.00% and 2030-2033 - 6.00%.

According Frankfurt Stock Exchange data, the GDP warrants rose 1.55% on Thursday and are now trading at 85.2% of their notional value.