MHP prepares to issue up to $1 billion in Eurobonds

MHP has begun preparations for a potential new bond issuance. The company is due to redeem $550 million in Eurobonds in April this year, Interfax-Ukraine reports.

According to disclosures by its subsidiaries Myronivska Poultry Farm, Zernoproduct MHP, Agrofort, and Oril-Leader in the NSSMC (National Securities and Stock Market Commission) disclosure system, on January 8, their shareholders approved the provision of guarantees in favour of MHP Lux S.A. for the bonds. The bonds may be issued and placed by this company on international capital markets for a total principal amount of up to $1 billion, with an interest rate not exceeding 25% per annum and a maturity of up to five years.

Citibank, N.A.’s London branch will act as trustee, while J.P. Morgan SE will serve as lead manager.

Previously, MHP was scheduled to redeem a major Eurobond issue of $500 million on May 10, 2024. Back in September–December 2023, the company announced several tenders for early repurchase of the bonds. As a result, it first repurchased $150.8 million of the bonds at 85% of par value, and later another $138.1 million at 95% of par.

In parallel, MHP secured financial support from a number of international financial institutions, which could be used to buy back the debt. The EBRD and the International Finance Corporation (IFC) confirmed their readiness to provide $100 million each, while the U.S. International Development Finance Corporation (DFC) is prepared to provide up to $250 million.