Peru announces stand-alone tender for existing bonds and issuance of new bonds

LIMA, Peru, Nov. 21, 2019 – — The Republic of Peru (“Peru“) announced today an offer (the “Offer”) to purchase for cash sovereign bonds or bonos soberanos (the “Old Bonos Soberanos“), including bonos soberanos in the form of Global Depositary Notes, previously issued by Citibank, N.A., as depositary (the “GDNs”, together with the Old Bonos Soberanos, the “Old Bonds”), in an aggregate principal amount based on a maximum aggregate purchase price that will be determined by Peru in its sole discretion (the “Maximum Purchase Amount”), subject to proration (if any), as described herein. Peru is not the issuer of any GDNs and is only offering to purchase the Old Bonos Soberanos underlying any GDNs.  BofA Securities, Inc., Citigroup Global Markets Inc., HSBC Securities (USA) Inc. and J.P. Morgan Securities LLC, will serve as the dealer managers for the Offer (collectively, the “Dealer Managers”) and Global Bondholder Services Corporation is acting as the information agent (the “Information Agent”) and as tender agent in the United States (the “U.S. Tender Agent”) for the Offer.

Peru also separately announced today an offer (the “Switch Tender Offer”) to purchase for cash (i) outstanding U.S. Dollar-Denominated Global Bonds, and (ii) sovereign bonds or bonos soberanos, including in the form of GDN’s previously issued by Citibank, N.A., as depositary. The Switch Tender Offer is being made subject to the terms and conditions set forth in the offer to purchase dated November 21, 2019 (the “Switch Tender Offer Document”) relating thereto. To request offering materials relating to the Switch Tender Offer, please contact the Information Agent, whose information is listed below.  

The Offer is made subject to the terms and conditions set forth in the offer to purchase dated November 21, 2019 (the “Offer Document”), including the pricing and closing, in an amount and on terms and conditions acceptable to Peru, of a new issuance of Peru’s sol-denominated bonos soberanos (the “New Bonos Soberanos“), which will be made solely by means of an offering memorandum (the “Financing Condition”). The Offer is not conditioned upon any minimum participation of Old Bonds. Peru reserves the right, in its sole discretion, not to accept any or all Offers and to terminate the Offer for any reason, or to accept an amount of Old Bonds. The aggregate total purchase price will be the total purchase price to be paid for all Old Bonds validly tendered (the “Aggregate Total Purchase Price”). If the Aggregate Total Purchase Price exceeds the Maximum Purchase Amount, Peru reserves the right, in its sole discretion, to prorate on the basis of the same proration factors. The aggregate principal amount of eligible  Bonos Soberanos (including in the form of GDNs) outstanding as of November 20, 2019 was S/231,125,000.

The New Bonos Soberanos, including in the form of GDNs, will be offered only to qualified institutional buyers in the United States in reliance on Rule 144A under the U.S. Securities Act of 1933, as amended (the “Securities Act”) and to non-U.S. persons outside the United States in reliance on Regulation S under the Securities Act (collectively, “Eligible Holders”).

Old Bonds

Outstanding

Aggregate Principal Amount of

Old Bonds
as of November 20, 2019 (1)

Purchase Price(2)

(4)

7.840% Bonos Soberanos due 2020

S/231,125,000

S/1,041.99

7.840% GDNs due 2020 (3)

S/1,040.99

                                   

(1)   These amounts may include Old Bonds held by institutions and companies controlled by the Peruvian Government that have not been cancelled.

(2)   Per S/1,000 principal amount of the Old Bonos Soberanos validly tendered and accepted for purchase. Holders whose Old Bonds are validly tendered and accepted for purchase pursuant to the Offer will also receive Accrued Interest (as defined below).  Holders whose Old Bonos Soberanos are validly tendered and accepted for purchase pursuant to the Offer will be paid in Soles and holders of GDNs whose Old Bonds are validly tendered and accepted for purchase pursuant to the Offer will be paid in U.S. dollars as described below.

(3)   Issued by Citibank, N.A., as the depositary, which, if accepted for purchase pursuant to the Offer, will be payable in U.S. dollars as described below. 

(4)   Per GDN validly tendered and accepted for purchase. Each GDN represents one Bono Soberano, which represents the U.S. dollar equivalent of S/1,000 in principal amount.  The Purchase Prices of GDNs reflect fees associated with the cancellation of the GDNs payable to Citibank, N.A., as the depositary.

The price payable per S/1,000 principal amount of Old Bonds tendered by holders and accepted pursuant to the Offer (the “Purchase Price”) during the Tender Period (as defined in the Offer Document) is provided in the table above.  Holders whose Old Bonds are validly tendered and accepted for purchase pursuant to the Offer will also receive an amount in cash equal to any accrued and unpaid interest on their Old Bonds up to (but excluding) Wednesday, December 4, 2019 (the “Settlement Date”) (“Accrued Interest”).  Payment will be made on the Settlement Date in U.S. dollars or Soles, as applicable, as further described herein.

The Purchase Price and the Accrued Interest of the Old Bonos Soberanos tendered and accepted in the form of GDNs will be calculated by converting the applicable Soles amounts to U.S. dollars, at the average rate between the bid price (compra) and the offer price (venta) of the exchange rate published by the Superintendencia de Banca, Seguros y AFP on its web site (http://www.sbs.gob.pe) at the close of business on the Business Day prior to 5:00 p.m., New York City time, on November 27, 2019  (such date and time, the “Expiration Deadline”), as adjusted for three decimals.

Peru will settle for cash, in Soles, any Old Bonos Soberanos validly tendered and accepted for purchase in the Offer and cancel such Old Bonos Soberanos. The Tender Agent will settle for cash, in U.S. dollars, any GDNs validly tendered and accepted for purchase in the Offer and will deliver such Old Bonos Soberanos underlying the GDNs, as the case may be, to Peru for cancellation.

This announcement does not constitute an offer to sell or the solicitation of an order to buy any securities including the New Bonos Soberanos.

THE OFFER WILL COMMENCE AT 8:00 A.M., NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 2019 AND, UNLESS EXTENDED OR EARLIER TERMINATED, THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME ON WEDNESDAY, NOVEMBER 27, 2019.  SEE “THE OFFER—PROCEDURES FOR SUBMITTING TENDERS OF OLD BONDS” IN THE OFFER DOCUMENT.

Tenders of GDNs must be submitted through a direct participant in The Depository Trust Company (“DTC”), Euroclear Bank S.A./N.V. (“Euroclear”) or Clearstream Banking Luxembourg, société anonyme (“Clearstream, Luxembourg“) systems, as applicable.  Tenders of Old Bonos Soberanos will be made by holders to the Ministerio de Economia y Finanzas (“MEF”) account at CAVALI S.A. ICLV (“CAVALI”). 

If you wish to tender your GDNs pursuant to the Offer, the direct participant through which you hold your GDNs must submit, prior to the Expiration Deadline, your offer to tender GDNs, by properly instructing DTC (through ATOP). Tenders of GDNs must be submitted through a direct participant in DTC.

If you hold your GDNs through a custodian (including through Euroclear or Clearstream, Luxembourg), you may not submit an Offer directly. You should contact your custodian to instruct the direct participant to submit Offers through ATOP on your behalf.  You must comply with the procedures and deadlines of any custodian through which you hold your Old Bonds.  A tender will not be valid unless received by the Tender Agent via ATOP.

Tenders of Old Bonos Soberanos must be made by holders to the MEF account at CAVALI. 

The acceptance of any tenders after the Expiration Deadline will be in the sole discretion of Peru.

Old Bonds tendered pursuant to the Offer may only be withdrawn in accordance with the procedures specified under “The Offer—Irrevocability; Withdrawal Rights” in the Offer Document prior to the Expiration Deadline, but not thereafter. 

Peru is making the Offer only in those jurisdictions where it is legal to do so.  See “Jurisdictional Restrictions” in the Offer Document.

The Offer is subject to Peru’s right, at its sole discretion and subject to applicable laws to extend, terminate, withdraw, or amend the Offer at any time. Each of Peru and the Dealer Managers reserve the rights, in the sole discretion of each of them, to not accept tenders for any reason.

To request offering materials, please contact the Information Agent:


Global Bondholder Services Corporation
65 Broadway – Suite 404
New York, NY 10006
United States of America
Attention:  Corporate Actions
Banks and Brokers Call:  (212) 430-3774
Toll free: (866) 470-3800
website: www.gbsc-usa.com/Peru/



The Dealer Managers for the Offer are:





BofA Securities, Inc.

One Bryant Park

New York, New York 10036

Citigroup Global Markets Inc.
388 Greenwich Street, 7th Floor
New York, New York 10013

HSBC Securities (USA) Inc. 
452 Fifth Avenue

New York, New York 10018

J.P. Morgan Securities LLC
383 Madison Avenue
New York, New York 10179





Attention: Liability Management

Group

Collect: (646) 855-8988

Toll-free: (888) 292-0070

Attention: Liability Management

Group

Toll Free: (800) 558-3745

Collect: (212) 723-6106 

Attention: Global Liability

Management Group

Toll Free: +1 (888) HSBC-4LM

Collect: +1 (212) 525-5552

Attention: Latin America –Debt Capital

Markets

U.S. Toll-Free: (866) 846-2874

U.S. Collect: (212) 834-7279









U.S. Tender Agent:

Global Bondholder Services Corporation

65 Broadway – Suite 404

New York, NY 10006

United States of America

Attention: Corporate Actions

Banks and Brokers call: (212) 430-3774

Toll free: (866) 470-3800
http://www.gbsc-usa.com/Peru/

Disclaimer

The Offer Document is not for release, publication or distribution to any person located or resident in any jurisdiction where it is unlawful to distribute the Offer Document. Persons into whose possession the Offer Document comes are required by Peru, the Dealer Managers and the Information Agent to inform themselves about, and to observe, any such restrictions.

This announcement is neither an offer to purchase nor the solicitation of an offer to sell any of the securities described herein, nor shall there be any offer or sale of such securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The Offer is made solely pursuant to the Offer Document dated the date hereof.

The Old Bonds are not being offered to the public within the meaning of Regulation (EU) 2017/1129 ( the “Prospectus Regulation”) and the Offer is not subject to the obligation to publish a prospectus under the Prospectus Regulation.

This announcement is for distribution only to persons who (i) have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the “Order”)), (ii) are persons falling within Article 49(2)(a) to (d) (“high net worth companies, unincorporated associations etc.”) of the Order, (iii) are persons falling within Article 43 of the Order, (iv) are outside the United Kingdom, or (v) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000) may otherwise lawfully be communicated or caused to be communicated (all such persons together being referred to as “relevant persons”).  This announcement is directed only at relevant persons and must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this document relates is available only to relevant persons and will be engaged in only with relevant persons.

This announcement must be read in conjunction with the Offer Document. This announcement and the Offer Document contain important information which should be read carefully before any decision is made with respect to the Offer. If any Bond holder is in any doubt as to the action it should take, it is recommended that such holder seek its own financial and legal advice, including as to any tax consequences, immediately from its stockbroker, bank manager, attorney, accountant or other independent financial or legal adviser. None of Peru, the Dealer Managers or the Information Agent makes any recommendation as to whether Bond holders should tender Bonds in the Offer or participate in the Offer.

This announcement contains forward-looking statements and information that is necessarily subject to risks, uncertainties and assumptions. No assurance can be given that the transactions described herein will be consummated or as to the terms of any such transactions. Peru assumes no obligation to update or correct the information contained in this announcement.

SOURCE The Republic of Peru

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