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NEWS

Tender, exchange and reopening of notes of Republic of Slovenia

Ljubljana, 20 September 2017 - On Tuesday 12th of September, the Republic of Slovenia (the “Republic”) rated Baa1 (stable) /A+ (stable) /A- (stable) (Moody’s/S&P/Fitch) announced a modified Dutch auction (“MDA”), offering options to purchase for cash or exchange for new 5.25% Notes due 2024, to be consolidated with the outstanding 5.25% Notes due 2024. The MDA targeted the Republic’s US$ 823.271m 5.500% Notes due 2022 and US$ 779.294m 5.850% Notes due 2023 (the “Notes”). The same notes were also tendered in May 2016, Aug 2016, Oct 2016, Mar 2017 and May 2017. At the same time, the Republic announced a potential EUR new issue to follow subject to market conditions. The offer was announced as part of the Republic’s effective debt management strategy aimed at providing liquidity to accepted holders.

US$ 333,647,000 Tender of Outstanding US$ 823,217,000 5.500% Notes due 2022 and
US$ 779,294,000 5.850% Notes due 2023

US$ 523,366,000 Exchange of Outstanding US$ 823,217,000 5.500% Notes due 2022 and
US$ 779,294,000 5.850% Notes due 2023 for 5.250% Notes due 2024

EUR 200,000,000 Reopening of the Outstanding 1.250% Notes due 2027 (ISIN: SI0002103685) and EUR 500,000,000 Reopening of the Outstanding 1.750% Notes due 2040 (ISIN: SI0002103677)

 

As at the Expiration Deadline of 17:00 CET on 19th of September 2017, the Republic received valid tenders for purchase of US$ 369.683m in aggregate nominal amount of Notes. In line with its effective government debt management objective, the Republic purchased US$ 333.647m in aggregate nominal amount of the Notes (the “Final Acceptance Amount”).  No scaling factor was applied. The Notes were purchased on a Non-Competitive basis only i.e. at the relevant Maximum Purchase Spread representing successful price and size outcome for the Republic.

 

Furthermore, the Republic received valid exchange offers of US$ 577.175m in aggregate nominal amount of Notes. In line with its effective government debt management objective, the Republic purchased US$ 523.366m in aggregate nominal amount of the Notes (the “Final Acceptance Amount”).  No scaling factor was applied. The Notes were purchased on a Non-Competitive basis only i.e. at the relevant Maximum Purchase Spread representing successful price and size outcome for the Republic. After applying the relevant exchange ratios, US$ 528.789m of new 2024 Notes were issued.

 

TENDER OFFER TERMS AND RESULTS

 

 

Clearing Spread

Reference U.S. Treasury Rate

Purchase Yield

Purchase Price

Tender Series Acceptance Amount

Notes Accrued Interest

2022 Notes

55bps

1.819%

2.369%

114.902%

U.S.$160,005,000

2.307%

2023 Notes

65bps

1.819%

2.469%

117.636%

U.S.$173,642,000

2.226%

 

EXCHANGE OFFER TERMS AND RESULTS

 

 

Clearing Spread

Reference U.S. Treasury Rate

Purchase Yield

Purchase Price

Exchange Series Acceptance Amount

Exchange Ratio

Net Accrued Interest

2022 Notes

55bps

1.819%

2.369%

114.902%

U.S.$211,072,000

99.633210%

1.740%

2023 Notes

65bps

1.819%

2.469%

117.636%

U.S.$312,294,000

102.003902%

1.646%

 

 

New 2024 Notes

 

 

 

 

 

 

 

 

New 2024 Notes Spread

Reference U.S. Treasury Rate

New 2024 Notes Yield

New 2024 Notes Price

Nominal Amount of New 2024 Notes

 

 

2024 Notes

40bps

2.229%

2.629%

115.325%

U.S.$ 528,789,000

 

 

 

On Wednesday 20th of September 2017, the Republic announced the mandate for increases of the outstanding 1.250% notes due 22 March 2027 and the outstanding 1.750% notes due 3 November 2040 Regulation S transactions in dematerialized registered form.

 

On the back of supportive market conditions, initial price guidance was announced on Wednesday 20th of September at approximately 9:30 CET at mid-swaps + 25bps area for reopening of March 2027 notes and mid-swaps + 60bps area for reopening of November 2040 notes. The orderbooks grew steadily, reaching a combined  size in excess of EUR 1.9bn (incl. 570m of Joint Lead Manager interest), which allowed the Republic to release revised price guidance at mid-swaps +22bps +/-2bps area for March 2027 notes and mid-swaps +57bps +/-2bps area for November 2040 notes at approximately 10:45 CET. Final terms were released at approximately 11:15 CET with a spread of mid-swaps +20bps and a size of EUR 200m for March 2027 notes and a spread of mid-swaps +55bps and a size of EUR 500m for November 2040 notes.

 

The transaction was successfully priced at approximately 16:15 CET with total combined demand at over EUR 2.7bn including EUR 570m Joint Lead Manager interest.

 

This deal marked the Republic’s sixth consecutive successful USD tender offer funded by EUR new issuance and allowed Slovenia to achieve its strategic goals of extending the overall duration of its debt stockpile and increasing the liquidity of its outstanding bonds at attractive all-in yields.

 

The above transactions follow the successful US$ 1,092m debt buyback and EUR 1,000m increase of March 2027 notes and EUR 1,000m increase of November 2040 notes that the Republic executed in May 2017.

 

Barclays, BNP Paribas, Deutsche Bank, Goldman Sachs International Bank and J.P. Morgan jointly led tender offer and reopening transactions.

 

REPUBLIC OF SLOVENIA EUR 200M REOPENING OF THE OUTSTANDING 1.250% NOTES DUE 2027 AND EUR 500M REOPENING OF THE OUTSTANDING 1.750% NOTES DUE 2040:

 

FINAL TERMS

 

Issuer Rating:

 

Baa1 (stable) / A+ (stable) / A- (stable)

Pricing Date:

 

20 September 2017

Settlement Date:

 

27 September 2017

Transaction

 

Reopening of March 2027 Notes

Reopening of November 2040 Notes

Amount Outstanding

 

EUR 2,800,000,000

EUR 2,500,000,000

Increase Amount

 

EUR 200,000,000

EUR 500,000,000

Maturity Date:

 

22 March 2027

3 November 2040

Next Coupon Date:

 

22 March 2018

3 November 2017

Annual Coupon:

 

1.250%

1.750%

Re-offer Price:

 

102.194%

94.468%

Re-offer Spread vs. Mid-Swaps:

 

20bps

55bps

Re-offer Yield:

 

1.006%

2.053%

Government Benchmark:

 

DBR 0.250% Feb 2027

DBR 4.750% Jul 2040

Re-offer Spread vs. Benchmark:

 

64.8bps

102.5bps

ISIN:

 

SI0002103685

SI0002103677

Joint Lead Managers:

 

Barclays, BNP Paribas, Deutsche Bank, Goldman Sachs International Bank and J.P. Morgan

 

IMPORTANT NOTICE:

 

THE INFORMATION HEREIN IS INDICATIVE ONLY. ALTHOUGH THE INFORMATION HEREIN IS REFLECTIVE OF THE TERMS OF THE SECURITIES CONTEMPLATED AS OF THE TIME OF THIS COMMUNICATION, THERE IS NO ASSURANCE THAT THE SECURITIES WILL ACTUALLY BE ISSUED. THE SECURITIES WILL BE ISSUED ON THE BASIS OF FINAL TERMS AND CONDITIONS THAT ARE EXPECTED TO BE DELIVERED TO INVESTORS PRIOR TO OR UPON SETTLEMENT. BEFORE MAKING ANY INVESTMENT DECISION AND ENTERING INTO ANY TRANSACTION IN RELATION TO THE SECURITIES, INVESTORS SHOULD TAKE STEPS TO ENSURE THAT THEY UNDERSTAND THE TRANSACTION AND HAVE MADE AN INDEPENDENT ASSESSMENT OF THE APPROPRIATENESS OF THE TRANSACTION IN THE LIGHT OF THEIR OWN OBJECTIVES. INVESTORS SHOULD MAKE SURE THAT THEY HAVE SUFFICIENT INFORMATION AVAILABLE IN RELATION TO THE REPUBLIC OF SLOVENIA BEFORE MAKING AN INVESTMENT IN THE SECURITIES. ANY DECISION TO PURCHASE ANY OF THE SECURITIES SHOULD ONLY BE MADE ON THE BASIS OF AN INDEPENDENT REVIEW BY A PROSPECTIVE INVESTOR OF THE ISSUER’S PUBLICLY AVAILABLE INFORMATION. NEITHER THE JOINT LEAD MANAGERS NOR ANY OF THEIR RESPECTIVE AFFILIATES ACCEPT ANY LIABILITY ARISING FROM THE USE OF, OR MAKE ANY REPRESENTATION AS TO THE ACCURACY OR COMPLETENESS OF, THIS DOCUMENT OR THE ISSUER’S PUBLICLY AVAILABLE INFORMATION. THE INFORMATION CONTAINED IN THIS DOCUMENT IS SUBJECT TO CHANGE WITHOUT NOTICE.

 

NEITHER THIS ANNOUNCEMENT NOR ANY COPY OF IT MAY BE TAKEN OR TRANSMITTED, DIRECTLY OR INDIRECTLY, INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION TO SELL, OR ANY SOLICITATION OF ANY OFFER TO PURCHASE OR SUBSCRIBE NOR SHALL IT (OR ANY PART OF IT) OR THE FACT OF ITS DISTRIBUTION, FORM THE BASIS OF, OR BE RELIED ON IN CONNECTION WITH, ANY CONTRACT THEREFORE. THE OFFER AND THE DISTRIBUTION OF THIS ANNOUNCEMENT AND OTHER INFORMATION IN CONNECTION WITH THE OFFER IN CERTAIN JURISDICTIONS MAY BE RESTRICTED BY LAW AND PERSONS INTO WHOSE POSSESSION ANY DOCUMENT OR OTHER INFORMATION REFERRED TO HEREIN COMES SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH RESTRICTION. ANY FAILURE TO COMPLY WITH THESE RESTRICTIONS MAY CONSTITUTE A VIOLATION OF THE SECURITIES LAWS OF ANY SUCH JURISDICTION. THIS ANNOUNCEMENT IS NOT AN OFFER FOR SALE OF ANY SECURITIES IN THE UNITED STATES. SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933. THE ISSUER HAS NOT REGISTERED AND DOES NOT INTEND TO REGISTER ANY PORTION OF ANY OFFERING IN THE UNITED STATES OR TO CONDUCT A PUBLIC OFFERING OF ANY SECURITIES IN THE UNITED STATES AND WOULD ONLY DO SO BY MEANS OF A PROSPECTUS THAT MAY BE OBTAINED FROM THE ISSUER THAT WOULD CONTAIN DETAILED INFORMATION ABOUT THE REPUBLIC OF SLOVENIA. THIS ANNOUNCEMENT IS ADDRESSED TO AND DIRECTED AT PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA THAT HAVE IMPLEMENTED DIRECTIVE 2003/71/EC, AS AMENDED (THE "PROSPECTUS DIRECTIVE") WHO ARE ''QUALIFIED INVESTORS'' WITHIN THE MEANING OF ARTICLE 2(1)(2) OF THE PROSPECTUS DIRECTIVE. IN ADDITION, THIS ANNOUNCEMENT IS DIRECTED SOLELY AT (I) PERSONS OUTSIDE THE UNITED KINGDOM; OR (II) "INVESTMENT PROFESSIONALS", AS SUCH TERM IS DEFINED IN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE ''ORDER''); OR (III) PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) (''HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS ETC'') OF THE ORDER; OR (IV) ANY OTHER PERSON TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED BY VIRTUE OF AN EXEMPTION TO SECTION 21(1) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 OR OTHERWISE IN CIRCUMSTANCES WHERE IT DOES NOT APPLY (ALL SUCH PERSONS IN (I)-(IV) ABOVE BEING ''RELEVANT PERSONS'').  ANY INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES WILL ONLY BE AVAILABLE TO AND WILL ONLY BE ENGAGED WITH RELEVANT PERSONS. ANY PERSON WHO IS NOT A RELEVANT PERSON SHOULD NOT ACT ON THIS ANNOUNCEMENT.

 

A SECURITIES RATING IS NOT A RECOMMENDATION TO BUY, SELL OR HOLD SECURITIES AND MAY BE SUBJECT TO REVISION OR WITHDRAWAL AT ANY TIME.

 

PUBLIC RELATIONS OFFICE