SOVEREIGN DEBT RESTRUCTURING | MASTERCLASS

A deep dive masterclass on sovereign debt restructuring, to be conducted virtually by Asian high yield bond expert Florian Schmidt.

30 June 2022 (Thu), 5pm Singapore/HK time

Hong Kong based Insurance company FWD Group is looking to amend terms of its offshore bonds after its holding company, PCGI Intermediate Holdings (PCGIIH) owned by Richard Li announced a proposed Initial Public Offering (IPO) at the US Securities and Exchange Commission (SEC). The company seeks approval from holders of its dollar $750mn zero coupon perps, $600mn 6.375% perps callable in 2024 and $900mn 5.75% 2024s to replace FWD as the issuer of the bonds with PCGIH. The insurer also wants to amend the cross-acceleration threshold for the 5.75% 2024s bullet bonds to $20mn from the existing $10mn. What this would entail is that a bond default will be triggered only if there is a delay in payments of more than $20mn compared to the current $10mn. Bondholders giving consent by June 30, 2021 will be paid 0.3% of the principal amount and those giving consent by July 6, 2021 will be paid 0.1%. The existing 6.375% perps and 2024s are callable at 101 of the face value in case of an IPO and at 101 or a 500bp coupon step-up if Richard Li or any affiliate ceases to control the issuer.
FWDs 6.375% perps were up 0.13 to trade at 104 while its ZC perps and 5.75% 2024s were largely flat to trade at 94.4 and106.41 respectively.
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