DTEK initiates moratorium on eurobond liabilities until Oct 28 for large-scale restructuring
The largest Ukrainian private energy holding DTEK has said that the holding is not able to pay the coupons on $910 million 2018 notes and initiates a moratorium on enforcement action and standstill in respect of the notes from the deadline until October 28, 2016.
"The purpose of the Scheme is to enable the company to create a stable platform during the period in which it seeks to negotiate with its creditors and finalize a full-scale restructuring of its capital structure," the company said on the London Stock Exchange (LSE) on Friday.
The meeting of noteholders to approve the moratorium is scheduled for April 25.
No less than 75% of noteholders are to give their consent and the moratorium will be effective. The company offers a bonus of 0.25% of the note value if noteholders give their consent.
In the period when the moratorium is in effect, the company is to pay 10% of accrued interest to noteholders or more if extra free cash is available.
All accrued and unpaid coupons will be capitalized in the period when the moratorium is in effect.
According to a press release of the holding, DTEK Energo offered a long-term note restructuring plan to foreign creditors and noteholders. A document will be drawn up to take into account the interests of the company and its partners.
"We continue our work and dialog with foreign creditors aimed at balancing the financial possibilities of the company to service credits. We hope that we will find consent within six months on the conditions of the long-term restructuring of the credit portfolio acceptable for all parties," DTEK said, citing Head of Corporate Finance Department at DTEK Dmytro Fedotov.
The press service said that in H1 2015 the company exchanged notes worth $200 million to new notes worth $160 million due in March 2018. In H2 2015 DTEK hired Rothschild as a financial advisor and Latham &Watkins as a law consultant to organize the debt rescheduling.