Peru announces switch tender for existing bonds and issuance of new bonds

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Nov 21, 2019, 08:39 ET

LIMA, Peru, Nov. 21, 2019 /PRNewswire/ -- The Republic of Peru ("Peru") announced today an offer (the "Offer") to purchase for cash (i) outstanding U.S. Dollar-Denominated Global Bonds (the "Old Global Bonds"), and (ii) sovereign bonds or bonos soberanos (the "Old Bonos Soberanos"), including bonos soberanos in the form of Global Depositary Notes previously issued by Citibank, N.A., as depositary (the "GDNs", together with the Old Bonos Soberanos and Old Global Bonds, collectively, the "Old Bonds"), in an aggregate principal amount to be determined by Peru, in its sole discretion (the "Maximum Purchase Amount") subject to proration (if any), as described herein; provided that Peru will not accept tenders of the 5.700% Bonos Soberanos due 2024 in any amount that would leave less than 50% of the principal amount outstanding of such series specified in the table below (including any such Bonos Soberanos due 2024 underlying GDNs). Peru is not the issuer of any GDNs and is only offering to purchase the Old Bonos Soberanos underlying any GDNs. BofA Securities, Inc., Citigroup Global Markets Inc. ("Citigroup"), HSBC Securities (USA) Inc. and J.P. Morgan Securities LLC, will serve as the dealer managers for the Offer and Global Bondholder Services Corporation is acting as the information agent for the Offer. Citibank del Perú S.A. ("Citibank Peru") is acting as billing and delivery bank for the Old Bonos Soberanos, and Citigroup is acting as billing and delivery bank for each of the GDNs and the Old Global Bonds (in such capacities, collectively, the "Billing and Delivery Banks").

Peru also separately announced today an offer (the "Stand-alone Tender Offer") to purchase for cash sovereign bonds or bonos soberanos, including bonos soberanos in the form of Global Depositary Notes previously issued by Citibank, N.A., as depositary. The Stand-alone Tender Offer is made subject to the terms and conditions set forth in the offer to purchase dated November 21, 2019 (the "Stand-alone Tender Offer Document") relating thereto. To request offering materials relating to the Stand-alone Tender Offer, please contact the Information Agent, whose information is listed below.

The Offer is made subject to the terms and conditions set forth in the offer to purchase dated November 21, 2019 (the "Offer Document"), including the pricing and closing, in an amount and on terms and conditions acceptable to Peru, of a new issuance of one or more series of Peru's sol-denominated Bonos Soberanos (the "New Bonos Soberanos"). Peru expects to announce the Maximum Purchase Amount including the Aggregate Purchase Amount of Tenders (as such terms are defined in the Offer Document) of each series of the Old Bonds that are accepted in the Offer and whether such series will be subject to any proration at or around 9:00 a.m., New York City time, on Friday, November 22, 2019. The Offer is not conditioned on any minimum participation by any series of Old Bonds. The aggregate principal amount of eligible U.S. Dollar-Denominated Global Bonds and Old Bonos Soberanos (including in the form of GDNs) outstanding as of November 20, 2019 was U.S.$2,708,095,000 and S/13,321,043,000, respectively.

This announcement does not constitute an offer to buy or a solicitation of an offer to sell any securities, including the New Bonos Soberanos.

The price payable per U.S.$1,000 or S/1,000, as applicable, principal amount for each series of Old Bonds tendered by holders and accepted pursuant to the Offer (the "Purchase Price") during the Tender Period (as defined in the Offer Document) is set forth in the tables below. Holders whose Old Bonds are validly tendered and accepted for purchase pursuant to the Offer will also receive an amount in cash equal to any accrued and unpaid interest on their Old Bonds up to (but excluding) Tuesday, December 3, 2019 (the "Settlement Date") ("Accrued Interest"). Payment will be made on the Settlement Date in U.S. dollars or Soles, as applicable, as further described herein.

		Purchase Price ⁽²⁾⁽⁴⁾
*Old Bonos Soberanos* and GDNs**	Outstanding Aggregate Principal Amount of Old Bonds as of November 20, 2019 ⁽¹⁾	Preferred	Non-Preferred
5.200% Bonos Soberanos due 2023.	S/1,776,910,000	S/1,100.63	S/1,100.63
5.200% GDNs due 2023 ⁽³⁾ ..............	-	S/1,100.63	S/1,099.63
5.700% Bonos Soberanos due 2024.	S/11,544,133,000	S/1,112.63	S/1,112.63
5.700% GDNs due 2024 ⁽³⁾ ..............	-	S/1,112.63	S/1,111.63

⁽¹⁾ These amounts may include Old Bonds held by institutions and companies controlled by the Peruvian Government that have not been cancelled.

⁽²⁾ Per S/1,000 principal amount of the Old Bonos Soberanos validly tendered and accepted for purchase. Holders whose Old Bonds are validly tendered and accepted for purchase pursuant to the Offer will also receive Accrued Interest (as defined below). Holders whose Old Bonos Soberanos are validly tendered and accepted for purchase pursuant to the Offer will be paid in Soles and holders of GDNs whose Old Bonds are validly tendered and accepted for purchase pursuant to the Offer will be paid in U.S. dollars as described below.

⁽³⁾ Issued by Citibank, N.A., as the depositary, which, if accepted for purchase pursuant to the Offer, will be payable in U.S. dollars as described below.

⁽⁴⁾ Per GDN validly tendered and accepted for purchase. Each GDN represents one Bono Soberano, which represents the U.S. dollar equivalent of S/1,000 in principal amount. The Purchase Prices of GDNs reflect fees associated with the cancellation of the GDNs payable to Citibank, N.A., as the depositary.


Old Global Bonds	Outstanding Aggregate Principal Amount of Old Bonds as of June 10, 2019 ⁽¹⁾	Purchase Price ⁽²⁾
7.350% U.S. Dollar-Denominated Old Global Old Bonds due 2025 ⁽³⁾..........	U.S.$1,646,481,000	U.S.$1,264.59
4.125% U.S. Dollar-Denominated Old Global Old Bonds due 2027 ⁽³⁾..........	U.S.$1,061,614,000	U.S.$1,119.64

⁽¹⁾ These amounts may include Old Bonds held by institutions and companies controlled by the Peruvian Government that have not been cancelled.

⁽²⁾ Per U.S.$1,000 principal amount of U.S. Dollar-Denominated Global Bonds validly tendered and accepted for purchase. Holders whose Old Global Bonds are validly tendered and accepted for purchase pursuant to the Offer will also receive Accrued Interest (as defined below). Holders whose U.S. Dollar-Denominated Global Bonds are validly tendered and accepted for purchase pursuant to the Offer will be paid in U.S. dollars.

The Purchase Price and the Accrued Interest of the Old Bonos Soberanos tendered and accepted in the form of GDNs will be calculated by converting the applicable Soles amounts to U.S. dollars, at the average rate between the bid price (compra) and the offer price (venta) of the exchange rate published by the Superintendencia de Banca, Seguros y AFP on its web site (http://www.sbs.gob.pe) at the close of business on the Business Day prior to the Expiration Time (as defined in the Offer Document), as adjusted for three decimals.

Only Eligible Holders of Old Bonos Soberanos, GDNs or U.S. Dollar-Denominated Global Bonds subject to the Offer, may submit Preferred Tenders (as defined in the Offer Document) for New Bonos Soberanos, including in the form of GDNs, as applicable, as set forth in the Offer Document.

Subject to the Maximum Purchase Amount and proration, Peru expects to accept Preferred Tender Orders (as defined in the Offer Document) to the extent validly tendered at or prior to the non-preferred expiration time, before any Non-Preferred Tender Orders (as defined in the Offer Document) are accepted in the Offer.

THE OFFER WILL COMMENCE AT OR AROUND 8:00 A.M., NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 2019 AND, UNLESS EXTENDED OR EARLIER TERMINATED, THE OFFER WILL EXPIRE AT (X) 12:00 P.M., NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 2019 FOR NON-PREFERRED TENDERS AND (Y) AT 4:00 P.M., NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 2019 FOR PREFERRED TENDERS (AS DEFINED IN THE OFFER DOCUMENT).

If you hold Old Bonos Soberanos, you may tender such Old Bonds through Citibank Peru, and if you do not have an account with Citibank Peru, through another dealer manager. If you hold GDNs, you may tender such Old Bonds through Citigroup, and if you do not have an account with Citigroup, through another dealer manager. If you hold Old Global Bonds, you may tender such Bonds through Citigroup, and if you do not have an account with Citigroup, through another dealer manager. You will NOT be able to submit tenders through Euroclear, Clearstream Banking Société Anonyme ("Clearstream"), the Depository Trust Company ("DTC") systems or CAVALI S.A. ICLV ("CAVALI"). The Billing and Delivery Banks will consolidate all tenders and accept Old Bonds for purchase on behalf of Peru. Peru expects to instruct the Billing and Delivery Banks to apply a portion of the proceeds of the New Bonos Soberanos Offering (as defined in the Offer Document) to acquire any Old Bonds validly tendered and accepted in the Offer upon the closing of the New Bonos Soberanos Offering. Old Bonds accepted for purchase will be settled on a delivery versus payment basis with the Billing and Delivery Banks on the Settlement Date, in accordance with customary brokerage practices for corporate fixed income securities.

If you hold Old Bonos Soberanos registered with CAVALI, you will not be able to tender the Old Bonds through CAVALI. You must submit tenders and deliver the Old Bonos Soberanos, in accordance with customary brokerage practices in Peru, to Citibank Peru.

If you hold GDNs or Old Global Bonds through DTC, they must be delivered for settlement to Citigroup no later than 3:00 p.m., New York City time, on the Settlement Date. This Offer will not be eligible for the DTC Automated Tender Offer Program.

If you hold GDNs or Old Global Bonds through Euroclear or Clearstream, the latest process you can use to deliver your Old Bonds to the applicable Billing and Delivery Bank is the overnight process, one day prior to the Settlement Date; you MAY NOT use the optional daylight process. The deadlines set by Euroclear, Clearstream or any such intermediary for the submission of Tender Orders may be earlier than the relevant deadlines specified in this Offer Document.

Failure to deliver Old Bonds on time may result, in Peru's sole discretion, in any of the following (i) cancellation of your tender and in your becoming liable for any damages resulting from that failure, and/or (ii) delivery of a buy-in notice for the purchase of such Old Bonds, executed in accordance with customary brokerage practices for corporate fixed income securities, and/or (iii) in the case of Preferred Tenders, (x) cancellation of your tender and (y) in your remaining obligated to purchase your allocation of New 2040 Bonos Soberanos in respect of your related Indication of Interest.

The Offer is subject to Peru's right, at its sole discretion and subject to applicable laws to extend, terminate, withdraw, or amend the Offer at any time. Each of Peru, the Billing and Delivering Banks and the dealer managers reserve the rights, in the sole discretion of each of them, to not accept Tenders for any reason.

To request offering materials, please contact the Information Agent:

Global Bondholder Services Corporation

65 Broadway – Suite 404

New York, NY 10006

United States of America

Attention: Corporate Actions

Banks and Brokers call: (212) 430-3774

Toll free: (866) 470-3800

http://www.gbsc-usa.com/Peru/

The Dealer Managers for the Offer are:

BofA Securities, Inc.
One Bryant Park
New York, New York 10036

Citigroup Global Markets Inc.

388 Greenwich Street, 7^th Floor

New York, New York 10013

HSBC Securities (USA) Inc.

452 Fifth Avenue
New York, New York 10018

J.P. Morgan Securities LLC

383 Madison Avenue

New York, New York 10179

Attention: Liability Management Group
Collect: (646) 855-8988
Toll-free: (888) 292-0070

Attention: Liability Management Group
Toll Free: (800) 558-3745
Collect: (212) 723-6106

Attention: Global Liability Management Group
Toll Free: +1 (888) HSBC-4LM
Collect: +1 (212) 525-5552

Attention: Latin America –Debt Capital Markets
U.S. Toll-Free: (866) 846-2874
U.S. Collect: (212) 834-7279

The Billing and Delivery Banks for the Offer are:

For Old Bonos Soberanos

For GDNs

For Old Global Bonds

Citibank del Perú S.A.

Av. Canaval y Moreyra 480, Piso 3,
San Isidro, Lima

Citigroup Global Markets Inc.

388 Greenwich Street, 7^th Floor

New York, New York 10013

Citigroup Global Markets Inc.

388 Greenwich Street, 7^th Floor

New York, New York 10013

Attention: Eduardo Cieza de León

Collect: +51 (1) 215-2055

Attention: Liability Management Group
Toll Free: (800) 558-3745
Collect: (212) 723-6106

Disclaimer

The Offer Document is not for release, publication or distribution to any person located or resident in any jurisdiction where it is unlawful to distribute the Offer Document. Persons into whose possession the Offer Document comes are required by Peru, the Dealer Managers and the Information Agent to inform themselves about, and to observe, any such restrictions.

This announcement is neither an offer to purchase nor the solicitation of an offer to sell any of the securities described herein, nor shall there be any offer or sale of such securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The Offer is made solely pursuant to the Offer Document dated the date hereof.

The Old Bonds are not being offered to the public within the meaning of Regulation (EU) 2017/1129 ( the "Prospectus Regulation") and the Offer is not subject to the obligation to publish a prospectus under the Prospectus Regulation.

This announcement is for distribution only to persons who (i) have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the "Order")), (ii) are persons falling within Article 49(2)(a) to (d) ("high net worth companies, unincorporated associations etc.") of the Order, (iii) are persons falling within Article 43 of the Order, (iv) are outside the United Kingdom, or (v) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000) may otherwise lawfully be communicated or caused to be communicated (all such persons together being referred to as "relevant persons"). This announcement is directed only at relevant persons and must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this document relates is available only to relevant persons and will be engaged in only with relevant persons.

This announcement must be read in conjunction with the Offer Document. This announcement and the Offer Document contain important information which should be read carefully before any decision is made with respect to the Offer. If any Bond holder is in any doubt as to the action it should take, it is recommended that such holder seek its own financial and legal advice, including as to any tax consequences, immediately from its stockbroker, bank manager, attorney, accountant or other independent financial or legal adviser. None of Peru, the Dealer Managers or the Information Agent makes any recommendation as to whether Bond holders should tender Bonds in the Offer or participate in the Offer.

This announcement contains forward-looking statements and information that is necessarily subject to risks, uncertainties and assumptions. No assurance can be given that the transactions described herein will be consummated or as to the terms of any such transactions. Peru assumes no obligation to update or correct the information contained in this announcement.

SOURCE The Republic of Peru