Ukraine Plans Euro-Denominated Bond Issue This Week
June 10 2019 - 5:35PM
Dow Jones News
By Matt Wirz
Ukraine is preparing to issue its first international bond under
the administration of President Volodymyr Zelensky, a former
comedian who was elected in April amid widespread discontent about
corruption in the country, people familiar with the deal said.
French bank BNP Paribas S.A. and Goldman Sachs Group Inc. will
underwrite the euro-denominated deal and are arranging a roadshow
through European financial capitals this week for Ukrainian
officials to meet investors, the people said.
The deal will be of benchmark size, meaning at least EUR500
million ($567 million), and comes amid of flurry of new bond
issuance globally as declining U.S. and European interest rates
encourage borrowers to tap capital markets. The government of
Ecuador is feeling out investors about a new bond sale this week,
one of the people said, and Fiserv Inc. launched a bond deal today
backing its $22 billion acquisition of First Data Corp.
The yield on the benchmark 10-year Treasury note, which falls as
prices rise, ended at 2.143%, according to Tradeweb, up from 2.085%
Friday. Trade tensions and concerns about global economic growth
have dragged the 10-year yield down from a multiyear high of 3.232%
reached in November.
Ukraine finance officials will meet with investors in Frankfurt,
London, Milan and Paris this week to gauge interest in a new
seven-year bond, the people familiar with the deal said. The
roadshow contrasts sharply with Ukraine's previous deal in March,
when the country quietly borrowed about $350 million directly from
JPMorgan Chase & Co., an unusual move aimed at avoiding market
turbulence surrounding the presidential elections.
Ukraine last borrowed in public markets in October when it
issued $2 billion of bonds via BNP, Goldman and JPMorgan.
Ukrainian bond yields soared last year as investors sold out of
emerging-markets debt broadly and as Mr. Zelensky gained in polls,
stoking uncertainty about his economic strategy and ability to deal
firmly with Russia, which has waged a proxy war in Eastern Ukraine
for five years.
Yields on the country's medium-term bonds climbed to about 10.5%
in January from about 7% a year earlier but have dropped
precipitously to about 8% since Mr. Zelinsky was elected and moved
quickly to strengthen Ukraine's ailing economy and tackle conflict
with Russia-backed separatists.
--Daniel Kruger contributed to this article.
Write to Matt Wirz at matthieu.wirz@wsj.com
(END) Dow Jones Newswires
June 10, 2019 17:20 ET (21:20 GMT)
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