MainMain

US, UK investors bought 82% of Ukraine's eurobonds

The peak amount of applications hit 9.5bn dollars.

US, UK investors bought 82% of Ukraine's eurobonds
Photo: Photo: LB.ua

The main buyers of Ukraine's new 15-year eurobonds worth 3bn dollars were investors from the USA (46 per cent) and the UK (36 per cent), Deputy Finance Minister Yuriy Butsa said on Facebook on 20 September.

"The final allocation was held among 300 investors, of which 78 per cent were asset managers and 15 per cent were hedge funds. US investors accounted for 46 per cent of the allocation, those from the UK, 36 per cent, and continental Europe, 16 per cent," Butsa wrote.

The deputy minister said he was amazed by investors' interest in Ukraine. "The peak amount of applications in the book from about 350 investors hit 9.5bn dollars," he said.

On 18 September, Ukraine, for the first time in four years, placed its eurobonds without the assistance of the United States or Russia. The 15-year eurobonds are worth 3bn dollars, the interest rate is 7.375 per cent. Of this amount, more than half will be spent on the redemption of eurobonds due in 2019-20 with the par value of 1.576bn dollars. The new eurobonds have an amortization structure and will be redeemed in four equal tranches in 2031-32.

Ukraine last placed its eurobonds in April 2013, when it sold 10-year eurobonds worth 1.25bn dollars under 7.5 per cent per annum. In February 2013, the Finance Ministry placed 10-year eurobonds worth 1bn dollars under 7.625 per cent per annum.

Since then, Ukraine have four times entered foreign borrowing markets: eurobonds worth 3bn dollars with a 5-per-cent coupon rate were sold in December 2013. In 2014-16, Ukraine sold eurobonds under US guarantees once every year. In 2014, the country placed five-year eurobonds worth 1bn dollars under 1.844 per cent per annum, in 2015 – 1bn dollars under 1.847 per cent per annum, in 2016 – 1bn dollars under 1.471 per cent per annum.

On 25 January, the Ukrainian company Kernel placed eurobonds worth 500m dollars under 8.75 per cent per annum, becoming the first issuer from Ukraine to place bonds since the Revolution of Dignity (with the exception of bonds guaranteed by the US government as part of the financial assistance to Ukraine).