MHP to purchase total 416 mln of 2020 notes

Ukraine’s leading poultry producer and farmer, MHP
(MHPSA, MHPC LI), got a late offer from bondholders for USD 6.4 mln of its 2020
notes, which results in total bonds tendered of USD 416.2 mln, the company
reported on April 9. The company has accepted all the offers, which means that
the total amount of 2021 notes outstanding will decrease to USD 79.4 mln (from
USD 750 mln originally issued and USD 495.6 mln before the tender offer).

Those who tendered bonds before the early deadline have
been paid at 109.5% of par, while those tendering before the late deadline will
be paid at 106.5% of par, which will result in MHP paying a total of USD 455.5
mln related to the bond tender. Including the proceeds from the issue of its
new 2026 bonds of USD 550 mln, MHP’s net proceeds from the recent debt
management operation will amount to USD 94.5 mln (before costs related to the
operation).

Alexander Paraschiy: By extending the maturity of its original USD 750 mln bond due in 2020
via tender offers made in April-May 2017 and March-April 2018, MHP has been preparing for Ukraine’s politically
turbulent season of 2019. Most likely, the company will take a pause in its debt
management operation till 2021-2022. MHP now has outstanding an illiquid 2020
bond and two more liquid notes maturing in 2024 (USD 500 mln) and 2026, all of
which are currently being traded inside Ukraine’s sovereign curve. We maintain
our neutral view on all MHPSA bond issues.