Astana Finance, the last of a quartet of Kazakh financial services providers to restructure its foreign debt, has shocked senior creditors with its latest write-off proposals.
The terms Astana Finance proposed in August would force Eurobond holders to accept an 80% haircut on principal and accrued interest on roughly $1.2 billion-worth of international debt, while they would receive zero-coupon 2016 notes for the remaining 20% balance.
Andre Andrijanovs, fixed-income analyst at emerging market debt trading specialist Exotix in London, says that the latest proposal means Eurobond holders can expect a cash return which represents a net present value offer of only 6% of their original investment, compared with the 16% that Astana Finance offered in December 2010 – an offer that was rejected by creditors.
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