Grenada government says debt exchange offer successful
(Caribbean 360) Government has announced that its debt exchange offer launched a month ago received the overwhelming support of local creditors.
Holders of 94 per cent of the country’s U.S. Dollar Bonds due 2025 and 100 per cent of E.C. Dollar Bonds due 2025 outstanding and eligible to vote in the exchange have agreed to provide extensive debt relief to Grenada by tendering their bonds in exchange for new Grenada U.S. Dollar and E.C. Dollar Bonds due 2030.
Under the terms of the U.S. Dollar Bonds due 2025 and Grenada’s exchange offer, holders of not less than 75 per cent of the U.S. Dollar Bonds due 2025 have provided instructions to the Trustee for the entirety of the U.S. Dollar Bonds due 2025 to be tendered in exchange for 2030 Bonds in accordance with the terms of Grenada’s offer.
The results of the tender process that ended earlier this week means that all bonds outstanding on the closing date will be exchanged for 2030 Bonds later this month.
“Today is a very important day for the people of Grenada, who are currently making sacrifices of their own in order to improve the prospects of our beloved country,” Prime Minister and Minister of Finance Dr. Keith Mitchell said in a statement issued this morning.
“We are delighted with the results of this process, which paves the way for the cancellation of 50 per cent of the face value of our international bonds. We extend our appreciation to our creditors for their cooperation and support.”
The new bonds, which have a final maturity date of May 2030, feature a natural disaster clause that, subject to certain conditions, will enable Grenada to capitalize interest and defer principal maturities due on the bonds in the event that Grenada is adversely affected by a hurricane.
Under the debt exchange, there is also a sharing mechanism that will entitle holders to receive a capped portion of revenues that may be generated by Grenada’s Citizenship by Investment programme above certain thresholds following the successful completion of the ECF.