MHP reportedly obtains necessary funds for 2015 notes redemption

Ukraine’s largest poultry producer MHP (MHPSA, MHPC LI) had obtained the necessary funding from the IFC to repay the 2015 Eurobond (USD 235 mln outstanding, due April 29, 2015). The company is reportedly transferring the money to the Luxemburg vehicle that issued the bond. This news is from a Debtwire report of Apr. 23 which referred to company sources. Debtwire did not disclose the exact amount received from IFC up-to-date. The company was not avaibale for a comment on this issue.

Roman Topolyuk: According to the most recent available information from the company, MHP has obtained three tranches worth USD 140 mln since January 2015, and has been expecting another one of USD 60 mln by the end of April. We estimate that the company had USD 321 mln of cash as of end-2014. That said, MHP should have enough liquidity to repay the USD 235 mln notes due on Apr. 29.

Once this successfully occurs, MHP might become the only Ukrainian corporate lender which have not employed the direct restructuring in the current market, when access to capital markets is limited. A back-up facility from IFC is a sort of mild refinancing, which allows the company to maintain its leverage. We expect that MHP will make an official announcement of the bonds’ repayment on Apr. 29, when the 2014 annual financials are to be reported.