The last public proposal that the Government made to the bondholders in the framework of the talks to achieve the restructuring of the securities of external debt Argentina includes a series of improvements in all the new bonuses offered by the country, with shorter maturities, better coupons, and shorter term payments. AND also adds a special title for the accrued interest of Par, Discount and global exchange bonds 2016.

Although the Minister of Economy, Martín Guzmán, announced on Monday that negotiations are continuing and they are working on the “final amendments” to the offer, it is the last known proposal so far.

When the Ministry of Economy made it public last week, it clarified that it is not a formal offer. But if it is a step forward in the negotiation, in which the Government has also already received some proposals from the main groups of creditors.

The initiative disseminated by the Ministry received the approval of the IMF on Monday, who insisted that this is a sustainable proposal.

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By
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In general terms, it continues to offer exchange current government securities issued in currency and under foreign law for another 10 new bonds, 5 in dollars and another 5, with similar but not identical characteristics, in euros. And a 2034 is added for the Par, Discount and global accrued interest of the exchange M.

The last proposal, which emerged from the Confidentiality Agreements, places the Net Present Value (NPV or NPV) at just over $ 47 per 100, calculated at an exit yield of 10%.

2030 bonus

It is a title raised for current bondholders maturing in 2023 or earlier.

In an original government offer, it implied a nominal capital cut of 12% for the dollar version and 18% for the euro version; the new proposal offers 7% in both cases.

The maturity is maintained in 2030 and the interest is paid semi-annually in North American currency and annually in European currency.

For the dollar version, there are no changes in rates, but in the euro version there is a cut (which compensates for the lower ‘haircut’).

The original offer foresaw, for the dollar bond, to cancel the capital in 5 annual installments since 2026, which would now be 12 semester since 2025; for the euro version, it went from 5 per year from 2026 to 6 per year from 2025.

Bonus 2034

Is the biggest novelty in the Government’s proposal, since it does not exist in the offer formalized before the SEC in April.

Is about a public title in dollars to pay “all the accrued interest of the eligible bonds (Par, Disocunt and global of the exchange 2016) until the date of liquidation of the exchange”.

The bonus pays 1% semi-annual interest since 2022 until maturity and repays the principal in 5 annual payments that start in 2030.

Bond 2035

It is designed for holders of securities maturing before 2036.

In the original offering these papers matured in 2036; in the new proposal maturity goes to 2035.

The capital cut or ‘haircut’ of 5% is maintained.

In both currencies grace period is reduced (Coupons – semi-annual in dollars and annual in euros – cut from 2022 instead of from 2023) and also the interest paid throughout the life of the bond is improved.

The principal of the securities in dollars would be paid in 10 semi-annual installments from 2031 (instead of 6 per year from the same year) and from the paper in euros, in 5 per year from 2031 (instead of 6 per year from the same year).

Bond 2038

It’s a bonus exclusive to Discount bondholders. Originally a maturity was proposed in 2039, but in the submitted proposal it expires in 2038.

It has no capital cut.

Both in the dollar version and in the euro version there are improvements in the coupons.

Capital payments are still in 11 identical annual installments, but would start in 2028 instead of 2029.

Bonus 2042

Is designed for those who have Par bonds, although they are also eligible by Discount holders. Originally, they were intended to expire in 2043.

It has no capital cut and there is coupon variations (In both currencies they pay more than before in the first part of the life of the bond; in the dollar version it offers a lower rate than before between 2026 and 2029 and in the euro version, it offers less interest than before between 2029 and expiration of the paper).

Regarding capital, it intends to pay it in 16 annual installments since 2027, instead of 14 annual installments since 2030.

Bonus 2046

It is the longest title offered and is “eligible” for any of the current bonds that enter the exchange. In this proposal to the bondholders – again: that it is not yet an official offer – their life was shortened in one year, since originally matured in 2047.

In both currencies, they offered much better rates than originally proposed especially for the first years.

For the title in dollars, the Government offers to cancel the capital in 44 semi-annual installments since 2025 (instead of 20 annually since 2028) and for the title in euros, in 22 annual installments since 2025 (instead of the 20 annual starting in 2028).

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