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Eighty Four Percent of Bondholders Approve Belize’s Buyout of the Superbond

The jury is out on the Superbond and best information to Love News is that just over eighty four percent of the bondholders have agreed to the buy-out proposal presented by Belize’s negotiators. Up to last weekend, Love News had learnt that close to sixty five percent of the bondholders had approved the buyout which would see an exchange of the Superbond for Blue Bonds through the facilitation of The Nature Conservancy Group. From the start, Belize had been cautiously optimistic that the country could well attain the required 75% percent approval from bondholders. Fast forward to tonight and there is reason to celebrate as instead of paying $572 million US dollars, Belize will pay off the superbond debt with $334million US dollars. The public debt would be reduced by some two hundred million US dollars and savings from switching from the superbond to the Blue Bonds for Conservation would amount to some 265million dollars. For all intents and purposes, it seems like a good deal as interest on the superbond was a notch below five percent while the Blue Bonds interest rate would be in the range of three to four percent. There is one issue, however, that remains up in the air and it has to do with the Venezuelan portion of the bonds. Venezuela accounts for some ten percent of the Superbond but due to the sanctions placed by the United States on Venezuela, it is uncertain how the payoff would occur. Earlier this month we had asked Dr Carl Ross of one investment group to weigh in on the Venezuela matter.

Dr.Carl Ross, Bondholder: “That’s a little bit uncertain as to whether that debt is held by a sanctioned entity and it complicates the transaction a little bit because of the sanctions against Venezuela so there’s a question as to whether the Venezuelan entities can participate. That’s something I don’t know to much about you might have to ask the Belize authorities what they plan to do about that.”

Reporter: But can that 75% approval still be achieved without factoring that Venezuela option ? 

Dr.Carl Ross, Bondholder: “So that’s a good question. It’s gonna be challenging but we are going to be working on behalf of Belize to try to convince as many of the non Venezuelan bond holders as we can to accept this. Our job would be much easier if the price were higher but this was the Belizean government was – they’re very very difficult, they’re very very tough negotiators I guess you could say and fifty five is where we came out and I think it’s gonna be doable to get the 75%  but it’s gonna be a challenge.”

In a release issued this evening from the Government’s Press Office, Prime Minister John Briceno was quoted as saying, “The Government of Belize is delighted that the vast majority of holders of the Government’s only international bond have indicated their support for this proposed transaction. We are attempting to achieve, in this one transaction, both significant debt relief and the long-term protection of Belize’s precious marine environment.” End of quote. With this approval from the majority bondholders Belize will now seek to satisfy other requirements to seal the deal and will now be looking to extend the deadline to have bondholders to submit tender orders by October 15. Love News understands that Citigroup Global Markets Inc. is acting as the Financial Advisor and ESG Structuring Advisor to Belize. In connection with the Offer and the Consent Solicitation, Citigroup Global Markets Inc. is acting as Dealer Manager and Global Bondholder Services Corporation is serving as Information and Tender Agent in connection with the Offer and Consent Solicitation.