LUISBOND
Forumer attivo
PDVSA 2017 che ha staccato recentemente la cedola con valuta 3/11 al possessore del bond prima del 3 novembre. abbiamo aspettato un po' ma ora va tutto bene........
Titoli di Stato paesi-emergenti VENEZUELA e Petroleos de Venezuela - Cap. 2
- Creatore Discussione tommy271
- Data di Inizio
GiveMeLeverage
& I will remove the world
Venezuelan creditors eyeing Citgo assets face uphill battle
Tom Hals
5 Min Read
WILMINGTON, Del. (Reuters) - Citgo Petroleum may look like a tempting target for bondholders of its parent company, Venezuelan-owned oil driller PDVSA, but the refinery operator’s complex debt structure could make its assets difficult for creditors to seize, legal experts said.
That may not be easy. Energy producer ConocoPhillips Co has gone to court alleging the pledge of 50.1 percent of Citgo stock is fraudulent, meaning the PDVSA bondholders will have a tough time getting their hands on the stock.
“Lots and lots of claimants have been circling Venezuela and PDVSA, so there is plenty of competition for every scant asset crumb, which means we should expect challenges at every turn,” said Anna Gelpern, a professor at Georgetown Law.
The battle over Houston-based Citgo, which was valued as high as $10 billion during an aborted 2014 sale process, illustrates the dearth of viable options for foreign creditors trying to collect from Venezuela.
Venezuela’s Maduro said in November he wanted to restructure all foreign debt, which includes some $60 billion in outstanding sovereign and PDVSA bonds. Private estimates put the total foreign obligations at more than $120 billion owed to creditors including Russia, China and oil service providers.
Negotiations with bondholders are almost impossible in the face of U.S. sanctions and the country has been ruled in default due to payment delays on some bonds, which for years have been a favorite of investors for their sky-high yields..
Faced with mounting concern that Venezuela will not be able to keep up the payments, some holders of around $3 billion worth of the 2020 bonds are talking to lawyers and advisers about initiating legal action to seize the Citgo stake.
Legal experts said they would face many hurdles, including Citgo’s issuance of billions of dollars of its own debt. Holders of Citgo debt could cite change-of-control provisions to demand immediate repayment if PDVSA’s bondholders got their hands on the Citgo stock, Deutsche Bank said last month in a note to clients.
“We see significant valuation risk in CITGO once the collateral collection process is triggered given potential legal challenges and other complications,” said the Nov. 27 note by strategist Hongtao Jiang.
PDVSA bondholders would also have to contend with Russian oil producer Rosneft, which has a lien on the remainder of Citgo’s stock. The lien, and the legal uncertainty hanging over Rosneft from U.S. sanctions, could undercut demand for acquiring Citgo if bondholders were to put it up for a sale, legal experts said.
“FREE-FOR-ALL”
Bondholders will also have to compete with other creditors who are gunning for Citgo.
“It will become a free-for-all,” said Mark Weidemaier, a professor at University of North Carolina School of Law.
One creditor of Venezuela, Crystallex International Corp, a Canadian gold miner, has already asked a federal judge in Delaware to void the stock pledge to the 2020 bondholders.
Crystallex says the pledge was a fraudulent transfer of value from Citgo, which got nothing from the stock pledge, to PDVSA. With such uncertainty hanging over the stock pledge, the bondholders will struggle to get full value for Citgo if they manage to foreclose on the shares, according to legal experts.
Crystallex has said in court papers it has reached an undisclosed settlement, which requires Crystallex to stay or withdraw its case in Delaware federal court once it begins receiving payments from Venezuela, according to court records.
But ConocoPhillips Co launched a similar action last year in the same Delaware court that also takes aim at undoing the stock pledge.
A trustee for Crystallex, which is operating in bankruptcy after Venezuela seized its mining operations, and a spokesman for ConocoPhillips declined to comment.
Finally, PDVSA could put Citgo’s U.S. holding company into U.S. Chapter 11 bankruptcy, which would prevent creditors from seizing Citgo stock, the main asset of the holding company.
However, bankruptcy can be chaotic and unpredictable and it would increase the risk that Citgo could wither during the process - a risk to both PDVSA as well as bondholders.
Richard Langberg, an analyst with S&P Global Ratings who follows Citgo, said the significant costs and uncertainty should give any creditor pause about trying to collect against Citgo.
“On a scale of one to 10,” he said of the degree of difficulty, “it’s a nine or a 10.”
Reporting by Tom Hals in Wilmington, Delaware; Editing by Noeleen Walder, Christian Plumb and Andrew Hay
Tom Hals
5 Min Read
WILMINGTON, Del. (Reuters) - Citgo Petroleum may look like a tempting target for bondholders of its parent company, Venezuelan-owned oil driller PDVSA, but the refinery operator’s complex debt structure could make its assets difficult for creditors to seize, legal experts said.
That may not be easy. Energy producer ConocoPhillips Co has gone to court alleging the pledge of 50.1 percent of Citgo stock is fraudulent, meaning the PDVSA bondholders will have a tough time getting their hands on the stock.
“Lots and lots of claimants have been circling Venezuela and PDVSA, so there is plenty of competition for every scant asset crumb, which means we should expect challenges at every turn,” said Anna Gelpern, a professor at Georgetown Law.
The battle over Houston-based Citgo, which was valued as high as $10 billion during an aborted 2014 sale process, illustrates the dearth of viable options for foreign creditors trying to collect from Venezuela.
Venezuela’s Maduro said in November he wanted to restructure all foreign debt, which includes some $60 billion in outstanding sovereign and PDVSA bonds. Private estimates put the total foreign obligations at more than $120 billion owed to creditors including Russia, China and oil service providers.
Negotiations with bondholders are almost impossible in the face of U.S. sanctions and the country has been ruled in default due to payment delays on some bonds, which for years have been a favorite of investors for their sky-high yields..
Faced with mounting concern that Venezuela will not be able to keep up the payments, some holders of around $3 billion worth of the 2020 bonds are talking to lawyers and advisers about initiating legal action to seize the Citgo stake.
Legal experts said they would face many hurdles, including Citgo’s issuance of billions of dollars of its own debt. Holders of Citgo debt could cite change-of-control provisions to demand immediate repayment if PDVSA’s bondholders got their hands on the Citgo stock, Deutsche Bank said last month in a note to clients.
“We see significant valuation risk in CITGO once the collateral collection process is triggered given potential legal challenges and other complications,” said the Nov. 27 note by strategist Hongtao Jiang.
PDVSA bondholders would also have to contend with Russian oil producer Rosneft, which has a lien on the remainder of Citgo’s stock. The lien, and the legal uncertainty hanging over Rosneft from U.S. sanctions, could undercut demand for acquiring Citgo if bondholders were to put it up for a sale, legal experts said.
“FREE-FOR-ALL”
Bondholders will also have to compete with other creditors who are gunning for Citgo.
“It will become a free-for-all,” said Mark Weidemaier, a professor at University of North Carolina School of Law.
One creditor of Venezuela, Crystallex International Corp, a Canadian gold miner, has already asked a federal judge in Delaware to void the stock pledge to the 2020 bondholders.
Crystallex says the pledge was a fraudulent transfer of value from Citgo, which got nothing from the stock pledge, to PDVSA. With such uncertainty hanging over the stock pledge, the bondholders will struggle to get full value for Citgo if they manage to foreclose on the shares, according to legal experts.
Crystallex has said in court papers it has reached an undisclosed settlement, which requires Crystallex to stay or withdraw its case in Delaware federal court once it begins receiving payments from Venezuela, according to court records.
But ConocoPhillips Co launched a similar action last year in the same Delaware court that also takes aim at undoing the stock pledge.
A trustee for Crystallex, which is operating in bankruptcy after Venezuela seized its mining operations, and a spokesman for ConocoPhillips declined to comment.
Finally, PDVSA could put Citgo’s U.S. holding company into U.S. Chapter 11 bankruptcy, which would prevent creditors from seizing Citgo stock, the main asset of the holding company.
However, bankruptcy can be chaotic and unpredictable and it would increase the risk that Citgo could wither during the process - a risk to both PDVSA as well as bondholders.
Richard Langberg, an analyst with S&P Global Ratings who follows Citgo, said the significant costs and uncertainty should give any creditor pause about trying to collect against Citgo.
“On a scale of one to 10,” he said of the degree of difficulty, “it’s a nine or a 10.”
Reporting by Tom Hals in Wilmington, Delaware; Editing by Noeleen Walder, Christian Plumb and Andrew Hay
GiveMeLeverage
& I will remove the world
Venezuela default more likely on sovereign bonds than PDVSA's: bondholders
Dion Rabouin
5 Min Read
NEW YORK (Reuters) - Venezuela is more likely to default on its sovereign bonds than on those of state-run oil company PDVSA given how essential the latter’s cash flow is to the country’s fortunes, bondholders and legal experts have said.
Both asset classes cratered last month after President Nicolas Maduro told creditors that Venezuela wanted to restructure its foreign debt, which includes some $60 billion in bonds issued by PDVSA PDVSA.UL and its owner, the Venezuelan government.
The oil Petroleos de Venezuela SA (PDVSA) produces is the country’s primary export and means of generating income. A default by PDVSA could leave its assets outside the country, mainly its U.S. refiner Citgo Petroleum, vulnerable to seizure.
“If, on the one hand, the Venezuelan government is intent on doing everything it can to protect PDVSA’s assets and, on the other hand, the country does not have the resources to service the debt of the Republic as well, one could imagine them deciding to continue to service the PDVSA bonds and cease payment of the republic bonds,” said Mark Walker, managing director and head of sovereign advisory at Millstein & Co.
“That said, we really do not know what the government’s strategy may be,” said Walker, who has been in informal discussions with creditors about the next potential steps after Maduro’s call for a debt restructuring.
Eight different investors and legal experts contacted by Reuters in recent days agreed that the PDVSA bonds were a safer bet than the sovereigns.
The Venezuelan government may soon be running low on cash, forcing it to make some hard decisions. Its crude output dipped last month to the lowest level in nearly three decades, producer group OPEC said. And about two dozen high-level PDVSA executives have been arrested in a major corruption sweep, ridding the company of much of its top brass.
“I have a hard time seeing them making sovereign payments next year,” Francisco Rodriguez, chief economist at hedge fund Torino Capital, said during a panel discussion on Venezuela sponsored by the Americas Society/Council of the Americas in New York.
Rodriguez noted that about 90 percent of Venezuela’s foreign exchange capacity comes from PDVSA.
Adding to the attractiveness of owning PDVSA’s rather than government bonds is that the oil company’s bonds do not include collective action clauses, or CACs. CACs allow a debt restructuring to go ahead with authorization from 75 percent of participants, binding any dissenting creditors into the process.
The majority of outstanding Venezuelan government debt (12 out of 14 issues) have CACs attached.
A group of about 200 bondholders who met most recently in London are unsure about how Venezuela will proceed, but those who consider a default to be imminent generally believe it will be in the sovereign issues rather than in PDVSA, according to sources familiar with the meeting.
The upcoming payments for PDVSA’s bonds over the next year are also lower than those owed on the nation’s sovereign bonds - $6 billion in sovereign payments versus $2.9 billion for PDVSA - perhaps providing Venezuela time to rebuild cash reserves without igniting an all-out war with creditors.
There has been little sign of this view being reflected in any kind of premium for PDVSA bonds over the Venezuelan sovereign, with both generally trading at around 20 cents to the dollar, with the exception of the oil company’s 2020 bonds, which are explicitly secured by a stake in Citgo.
The uncertainty about what will happen next with Venezuelan debt in general has been exacerbated by U.S. sanctions - preventing further debt from being issued and therefore making a restructuring impossible - and Venezuela’s economic collapse.
Still, the view that PDVSA debt would be a better bet than the sovereign is far from unanimous, with some investors saying the country’s situation is dire enough that there’s little upside in either.
”We don’t own any Venezuela debt and I think differentiating between the sovereign and PDVSA bonds is like rearranging the deck chairs on the Titanic,” said James Barrineau, co-head of emerging market debt at Schroders Investment. “This is a hyperinflationary economy that’s spiraling downward at a rapid rate and oil production is imploding.”
The situation is far worse than in other countries that have gone through debt restructurings, such as Argentina, Ecuador, Greece or Ukraine, both Barrineau and Millstein’s Walker said.
“This isn’t going to be an Argentina type of situation,” said Barrineau. “It’s going to be vastly more complex.”
Reporting by Dion Rabouin; Editing by Christian Plumb and Susan Thomas
Dion Rabouin
5 Min Read
NEW YORK (Reuters) - Venezuela is more likely to default on its sovereign bonds than on those of state-run oil company PDVSA given how essential the latter’s cash flow is to the country’s fortunes, bondholders and legal experts have said.
Both asset classes cratered last month after President Nicolas Maduro told creditors that Venezuela wanted to restructure its foreign debt, which includes some $60 billion in bonds issued by PDVSA PDVSA.UL and its owner, the Venezuelan government.
The oil Petroleos de Venezuela SA (PDVSA) produces is the country’s primary export and means of generating income. A default by PDVSA could leave its assets outside the country, mainly its U.S. refiner Citgo Petroleum, vulnerable to seizure.
“If, on the one hand, the Venezuelan government is intent on doing everything it can to protect PDVSA’s assets and, on the other hand, the country does not have the resources to service the debt of the Republic as well, one could imagine them deciding to continue to service the PDVSA bonds and cease payment of the republic bonds,” said Mark Walker, managing director and head of sovereign advisory at Millstein & Co.
“That said, we really do not know what the government’s strategy may be,” said Walker, who has been in informal discussions with creditors about the next potential steps after Maduro’s call for a debt restructuring.
Eight different investors and legal experts contacted by Reuters in recent days agreed that the PDVSA bonds were a safer bet than the sovereigns.
The Venezuelan government may soon be running low on cash, forcing it to make some hard decisions. Its crude output dipped last month to the lowest level in nearly three decades, producer group OPEC said. And about two dozen high-level PDVSA executives have been arrested in a major corruption sweep, ridding the company of much of its top brass.
“I have a hard time seeing them making sovereign payments next year,” Francisco Rodriguez, chief economist at hedge fund Torino Capital, said during a panel discussion on Venezuela sponsored by the Americas Society/Council of the Americas in New York.
Rodriguez noted that about 90 percent of Venezuela’s foreign exchange capacity comes from PDVSA.
Adding to the attractiveness of owning PDVSA’s rather than government bonds is that the oil company’s bonds do not include collective action clauses, or CACs. CACs allow a debt restructuring to go ahead with authorization from 75 percent of participants, binding any dissenting creditors into the process.
The majority of outstanding Venezuelan government debt (12 out of 14 issues) have CACs attached.
A group of about 200 bondholders who met most recently in London are unsure about how Venezuela will proceed, but those who consider a default to be imminent generally believe it will be in the sovereign issues rather than in PDVSA, according to sources familiar with the meeting.
The upcoming payments for PDVSA’s bonds over the next year are also lower than those owed on the nation’s sovereign bonds - $6 billion in sovereign payments versus $2.9 billion for PDVSA - perhaps providing Venezuela time to rebuild cash reserves without igniting an all-out war with creditors.
There has been little sign of this view being reflected in any kind of premium for PDVSA bonds over the Venezuelan sovereign, with both generally trading at around 20 cents to the dollar, with the exception of the oil company’s 2020 bonds, which are explicitly secured by a stake in Citgo.
The uncertainty about what will happen next with Venezuelan debt in general has been exacerbated by U.S. sanctions - preventing further debt from being issued and therefore making a restructuring impossible - and Venezuela’s economic collapse.
Still, the view that PDVSA debt would be a better bet than the sovereign is far from unanimous, with some investors saying the country’s situation is dire enough that there’s little upside in either.
”We don’t own any Venezuela debt and I think differentiating between the sovereign and PDVSA bonds is like rearranging the deck chairs on the Titanic,” said James Barrineau, co-head of emerging market debt at Schroders Investment. “This is a hyperinflationary economy that’s spiraling downward at a rapid rate and oil production is imploding.”
The situation is far worse than in other countries that have gone through debt restructurings, such as Argentina, Ecuador, Greece or Ukraine, both Barrineau and Millstein’s Walker said.
“This isn’t going to be an Argentina type of situation,” said Barrineau. “It’s going to be vastly more complex.”
Reporting by Dion Rabouin; Editing by Christian Plumb and Susan Thomas
GiveMeLeverage
& I will remove the world
Leggendo i due articoli sembrerebbe di poter concludere:
- PDVSA da preferire a sovereign
- PDVSA 2020 (quello Citgo-secured) da shortare
In pratica ci sono 3 categorie di bond PDVSA:
1. 2020 Citgo secured
2. 2022 ghost bond (quello dell'asta CDS)
3. gli altri, "normali"
Il ghost bond è molto difficile da valutare, vista l'assenza di un prospetto.
Direi 2021 long, 2020 short come possibile trade.
Obiezione al trade: in caso di ristrutturazione è difficile giustificare un recovery uguale per il secured e per gli unsecured (ma d'altra parte l'attesa per tale differenza di trattamento è già ampiamente riflessa nei prezzi)
Che voi sappiate, gli intermediari lasciano shortare agevolmente le PDVSA?
- PDVSA da preferire a sovereign
- PDVSA 2020 (quello Citgo-secured) da shortare
In pratica ci sono 3 categorie di bond PDVSA:
1. 2020 Citgo secured
2. 2022 ghost bond (quello dell'asta CDS)
3. gli altri, "normali"
Il ghost bond è molto difficile da valutare, vista l'assenza di un prospetto.
Direi 2021 long, 2020 short come possibile trade.
Obiezione al trade: in caso di ristrutturazione è difficile giustificare un recovery uguale per il secured e per gli unsecured (ma d'altra parte l'attesa per tale differenza di trattamento è già ampiamente riflessa nei prezzi)
Che voi sappiate, gli intermediari lasciano shortare agevolmente le PDVSA?
noname
Forumer attivo
Ciao, articolo che condivido mio malgrado, avendo investito in soberanos (per ora). E' chiaro che un default su pdvsa possa, ma non è detto, tagliare le entrate in valuta per lo stato, che sono vitali. Una ristrutturazione dei bonos statali, nel caso in cui pdvsa non fosse aggredibile, sarebbe invece più fattibile. In ogni caso se fossi Maduro è così che farei anche perchè davanti all'opinione pubblica in previsione delle elezioni, farei un figurone.
Poi bisognerebbe capire come avete sottolineato più volte, come sono intrecciati pdvsa e stato sovrano, ma nell'incertezza, se dovessi rischiare, prima "defaulterei" in soberanos, tanto "defaultare" pdvsa viene sempre in tempo...
Scusate per il pensierino semplice semplice e speriamo in bene.
arkymede74
Forumer storico
dici che questa settimana non potrebbero sbloccare? o pensi che non si vedrà mai un centesimo di quelle cedole?
