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GTBank launches cash tender for $500,000,000 7.50% Eurobond

gtbIn other to boost the country’s challenging economy, alleviate fears by investors on their US Notes and protect the naira currency, Guarantee Trust Bank has announced the cash tender for the $5000, 000,000 7.50% Eurobonds finance B.V maturing May 2016.

Embarking on this milestone would make available US dollar liquidity to the repurchase of the security ahead of the scheduled date. This offer will be open from the 4th of February to the 10th of February.

This unprecedented and historic move transaction would guarantee investors and customers who are worried about the dollar illiquidity as well as the bank inability to pay the bond come May 2016 to submit their note for redemption prior to maturity. It would further boost the financial strength of the bank and foster her commitment to excellence and best practices for dollar liquidity.

GTBank had to do this to calm the nerves of international Bond holders, worried that Nigerian Banks would not be able to meet their dollar obligations in view of the scarcity of dollars.

In a statement issued, GTBank explained “through the Offer, the Bank seeks to deploy its available U.S. dollar liquidity to the repurchase of the Securities ahead of the scheduled maturity in May 2016. This liability management exercise allows the Bank to efficiently manage its liquidity by addressing in full debt maturing in 2016. The extent to which this goal can be achieved through the Offer will depend on the number of Securities that will be tendered in the Offer, given the voluntary nature of the Offer. The Bank intends to maintain cash available to repay any outstanding Securities not tendered in full at maturity.

The Bank also stated “any Securities purchased by the Offeror will be surrendered for cancellation to the principal paying agent in respect of the Securities.”

The Offer commences on 4 February 2016 and will end at the Expiration Deadline. If the Expiration Deadline is extended by the Offeror, an announcement to that effect will be made by or on behalf of the Offeror by the means described in the Tender Offer Memorandum no later than 9:00 a.m. (New York City time), on the next Business Day after the previously scheduled Expiration Deadline.

The relevant deadline set by any intermediary or the Clearing Systems for the submission of Tender Instructions may be earlier than this deadline.

The results of the Offer are expected to be announced on or about 11 February 2016. The Offeror will announce the aggregate principal amount of Securities accepted for purchase. Such information will be notified to Holders as described in the Tender Offer Memorandum and shall, absent manifest error, be final and binding on the Offeror and the Holders.

Once the Offeror has announced the results of the Offer in accordance with applicable law, the Offeror’s acceptance of Tender Instructions in accordance with the terms of the Offer will be irrevocable. Tender Instructions, which are so accepted, will constitute binding obligations of the submitting Holders and the Offeror to settle the Offer.

“If the Offeror decides to accept valid tenders of Securities pursuant to the Offer, the total amount the Offeror will pay Holders on the Settlement Date for each U.S. $1,000 in principal amount of Securities accepted for purchase pursuant to the Offer will be an amount (rounded to the nearest U.S.$0.01) equal to: the Purchase Price and accrued Interest on such U.S.$1,000 in principal amount.

“ If, following acceptance of Securities for purchase by the Offeror pursuant to the Offer and following purchase of the relevant Securities on the Settlement Date, a Holder continues to hold in its account with the relevant Clearing System less than U.S.$200,000 in principal amount of Securities, in order to ensure that it will be possible to trade any residual holding in the Clearing Systems such Holder would need to purchase an additional principal amount of Securities such that its aggregate holding amounts to at least U.S.$200,000.

In order to receive the Purchase Price and Accrued Interest, holders of Securities must validly tender their Securities by the Expiration Deadline, by delivering, or arranging to have delivered on their behalf, a valid Tender Instruction that is received by the Tender Agent by the Expiration Deadline. Any amount tendered must be equal to or greater than the Minimum Denomination of U.S.$200,000.

Holders are advised to read carefully the Tender Offer Memorandum for full details of, and information on the procedures for participating in the Offer.

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