Mongolia provides details on exchange offers for 2023 notes, 2024 notes

Chicago, Jan. 11 – The government of Mongolia provided details regarding the exchange offers relating to its $517.23 million outstanding 5 5/8% notes due 2023 (ISIN: USY6142NAB48, US60937LAB18) and $600 million outstanding 8¾% notes due 2024 (ISIN: USY6142NAA64, US60937LAA35), according to a notice.

As previously reported, Mongolia is offering

• To purchase for cash any and all of the 2023 notes;

• To exchange the 2023 notes for new notes, subject to the maximum exchange acceptance amount;

• To exchange the 2024 notes for new notes, subject to the maximum exchange acceptance amount; and

• To purchase for cash up to a maximum tender acceptance amount of the 2024 notes.

Mongolia provided the pricing and exchange ratio and the maximum exchange acceptance amount in an announcement on Wednesday.

New notes

The exchange notes will be fungible with a new offering of debt securities.

Mongolia announced the pricing terms on Wednesday for the new notes (B/B).

The notes have an 8.65% coupon and priced at 98.812 to yield 8.95%.

Proceeds from the $450 million principal amount of notes will be used to fund the tender and exchange offers.

Considerations

Mongolia is offering (i) $1,000 of cash, plus accrued interest, per $1,000 of notes under the tender offers and (ii) $1,000 of new notes multiplied by the relevant exchange ratio, plus accrued interest, under the exchange offers.

The exchange ratios have been announced, post-pricing.

The exchange ratios for both notes are 1.012023 resulting in an exchange amount of $1,012.023 of new notes for each $1,000 of existing notes plus accrued interest on each of the notes.

Offer caps

The exchange offers are subject to a cap.

The cap was set at $200 million on Wednesday.

If the amount of old notes tendered for exchange in the exchange offers exceeds the maximum exchange acceptance amount, the government intends to prioritize accepting 2023 notes tendered in the 2023 exchange offer over 2024 notes tendered in the 2024 exchange offer.

The government said it reserves the right to increase or decrease the cap on the exchange offers.

The cap for the 2024 tender offer will be an amount that results in the aggregate 2024 tender consideration equaling the aggregate gross proceeds of the new notes issuance, less accrued interest and any cash rounding amount under the exchange offers, plus the aggregate principal amount of 2023 notes accepted for exchange, minus $517.23 million (the amount of 2023 notes outstanding).

The government said it expects to announce the determination of the maximum 2024 tender acceptance amount as soon as practicable on or after the expiration date.

Because of the offer caps, old notes tendered under the 2023 exchange offer, 2024 exchange offer or 2024 tender offer may be subject to proration.

Details

The offers will expire at 5 p.m. ET on Jan. 13.

Results of the offers and the 2024 tender cap are expected to be announced as soon as Jan. 16.

Settlement will be as soon as Jan. 19.

The dealer managers for the offers are Credit Suisse (Hong Kong) Ltd. (+852 2101 6000; fax +852 2284 7184; list.liabilitymanagementasia @credit-suisse.com), J.P. Morgan Securities plc (+852 2800 8219, +852 2800 7632; liability_Management_HK@jpmorgan.com), MUFG Securities Asia Ltd. (+33 1 70 91 42 79, +852 2860 1678, liability.management@mufgsecurities.com), Hongkong and Shanghai Banking Corp. Ltd. (888 HSBC-4LM, +852 3941 0223, +44 20 7992 6237, 212 525-5552; liability.management@hsbcib.com).

Morrow Sodali Ltd. (+44 20 4513 6933, 203 609-4910, +852 2319 4130; mongolia@investor.morrowsodali.com; https://projects.morrowsodali.com/ mongolia) is the information, exchange and tender agent.

The purpose of the offers is to extend the maturity profile of a portion of Mongolia’s external debt. The government said it believes that the offers provide an opportunity for noteholders to gain liquidity with respect to the old notes that might not otherwise be available.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.