SOURCE: Republic of Argentina

December 30, 2010 11:56 ET

Argentina Announces Preliminary Results of the Invitation

BUENOS AIRES, ARGENTINA--(Marketwire - December 30, 2010) -  The Republic of Argentina ("Argentina") announced today the preliminary results of its invitation announced on December 6, 2010 to tender Brady Bonds for New Securities and a Cash Payment (the "Invitation"). Terms are used herein with the meanings used in the Invitation Materials (as defined below), unless otherwise noted.

Principal Amount of Eligible Securities Tendered as of the Expiration Date

Owners of Eligible Securities having an aggregate principal amount totaling approximately U.S.$267,201,297.33, or its equivalent, submitted tenders during the Submission Period of the Invitation, which ended at 5:00 P.M. (Central European time), on December 29, 2010, the Expiration Date. Argentina calculates that the following principal amount of each series of Eligible Securities submitted tenders as of the Expiration Date:

Series of Eligible Securities   Outstanding Principal Amount   Principal amount of Eligible Securities tendered as of the Expiration Date   Percentage of Outstanding Principal Amount of Eligible Securities tendered as of the Expiration Date
U.S. dollar Collateralized Fixed Rate Bonds due 2023 (USD Par Series L)("USD Par Bonds")   U.S.$185,047,000   U.S.$151,123,000   81.67%
U.S. dollar Collateralized Floating Rate Bonds due 2023 (USD Discount Series L)("USD Discount Bonds")   U.S.$77,900,000   U.S.$69,766,000   89.56%
Deutsche Mark Collateralized Fixed Rate Bonds due 2023 (DM Par Series)("DM Par Bonds")   EUR 46,417,633   EUR 32,152,589.95   69.27%
Deutsche Mark Collateralized Floating Rate Bonds due 2023 (DM Discount Series)("DM Discount Bonds")   EUR 7,756,298   EUR 4,642,530.28   59.85%

Argentina has accepted all tenders of Eligible Securities that have been validly submitted as of the Expiration Date, subject to the reconciliation of electronic acceptance notices with letters of transmittal, in the case of tenders of DM Brady Bonds, the reconciliation of letters of transmittal with certificates delivered, in the case of tenders of USD Brady Bonds in physical form, and the satisfaction or the waiver of the conditions to the Invitation, including the Amendment Condition. 

Quorum Requirements for the Bondholders' Meetings

Pursuant to Argentina's preliminary calculations of the aggregate principal amount of each series of Eligible Securities tendered as of the Expiration Date, a sufficient amount of Eligible Securities of each series of Eligible Securities will be present to constitute a quorum at the Bondholders' Meetings for each series of Eligible Securities for the purposes of voting on the Resolutions. 

Aggregate Principal Amount of New Securities to be Issued and Aggregate Cash Payments

Subject to the reconciliation of electronic acceptance notices with letters of transmittal, in the case of tenders of DM Brady Bonds, the reconciliation of letters of transmittal with certificates delivered, in the case of tenders of USD Brady Bonds in physical form, and to the satisfaction or the waiver of the conditions to the Invitation, including the Amendment Condition, Argentina's preliminary calculation of the aggregate principal amount of each series of New Securities to be issued pursuant to the Invitation is set forth below:

Series of New Securities   ISIN   Aggregate principal amount of New Securities to be issued
U.S. dollar-denominated discount bonds due December 31, 2033 ("Discounts")   XS0501194756 or XS0564040821   U.S.$28,954,735
U.S. dollar-denominated 8.75% global bonds due 2017 ("2017 Globals")   XS0501195480 or XS0564043502   U.S.$8,502,875
U.S. dollar-denominated GDP-linked Securities expiring no later than December 15, 2035 ("GDP-linked Securities")   XS0501197262   U.S.$86,329,073

Argentina's preliminary calculation of the aggregate amount of the Cash Payments to be made pursuant to the Invitation, as of the date hereof, is U.S.$166,603,924.22, consisting of U.S.$133,407,457.84 in respect of Cash Proceeds of Brady Collateral securing the USD Brady Bonds, EUR 23,672,729.31 consisting of Cash Proceeds of Brady Collateral securing the DM Brady Bonds, and U.S.$1,908,487.31 and EUR 211,224.18, as applicable, consisting of Cash Payments to be funded by Argentina.

The preliminary calculations set forth above were made assuming that the Cash Proceeds would be calculated using interest rates and swap rates determined as of December 28, 2010, while the actual Cash Proceeds will be calculated using interest rates and swap rates at the time of liquidation of the relevant Brady Collateral.

The Invitation is being extended to holders of Brady Bonds in the United States on the basis of a prospectus dated April 13, 2010 and a prospectus supplement dated December 3, 2010 (collectively, the "US Prospectus") filed with the U.S. Securities and Exchange Commission ("SEC") and to holders of Brady Bonds in Argentina, Luxembourg, Germany and Italy on the basis of a separate prospectus dated December 3, 2010 (the "EU Prospectus"). The Invitation being extended under the above documents and the related electronic acceptance notices and/or letters of transmittal (collectively, the "Invitation Materials") constitute one and the same Invitation.

Application has been made to list each series of New Securities on the Luxembourg Stock Exchange and to have the New Securities admitted to trading on the Euro MTF market of the Luxembourg Stock Exchange. The Luxembourg Stock Exchange's alternative Euro MTF market is a multilateral trading facility for the purposes of the Markets in Financial Instruments Directive (MiFID) 2004/39/EC. Application will also be made to list the New Securities on the Buenos Aires Stock Exchange and to have the New Securities admitted to trading on the Mercado Abierto Electrónico. However, there can be no guarantee that any such listing will be completed before the Settlement Date for the Invitation or at all. 

None of Argentina, the information, exchange and tabulation agent or the custodian has expressed any opinion as to whether the terms of the Invitation are fair. In addition, none of the clearing systems through which holders may tender their Brady Bonds has expressed any opinion as to whether the terms of the Invitation are fair. None of Argentina, the information, exchange and tabulation agent or the custodian makes any recommendation that holders tender their Brady Bonds for exchange or refrain from doing so pursuant to the Invitation, and no one has been authorized by Argentina, the information, exchange and tabulation agent or the custodian to make any such recommendation. Holders must make their own decision as to whether to tender Brady Bonds in exchange for New Securities and a Cash Payment or refrain from doing so, and, if holders do tender Brady Bonds, the principal amount of Brady Bonds to tender.

WHERE TO GET INFORMATION

Bondholder Communications Group, LLC is acting as information, exchange and tabulation agent for the Invitation. The Invitation is not being made hereby, but instead is being made pursuant to the Invitation Materials. Copies of the US Prospectus, the EU Prospectus and the other Invitation Materials can be obtained online at http://www.bondcom.com/argentina and by contacting the information, exchange and tabulation agent at one of the telephone numbers below. The information, exchange and tabulation agent will answer questions regarding tender procedures from clearing system participants, custodians and holders of USD Brady Bonds in physical form.

 
The information, exchange and tabulation agent for the Invitation is:

Bondholder Communications Group, LLC
Attn: Roberta Alvarez
E-mail: ralvarez@bondcom.com
Invitation Website: http://www.bondcom.com/argentina
In New York:
30 Broad St., 46th floor
New York, NY 10004
Tel: +1 212 809 2663
Fax: +1 212 437 9827
  In London:
28 Throgmorton
London EC2N 2AN
Tel: +44 (0)20 7382 4580
Fax: +44 (0)20 7067 9329
In Germany:
Tel: 0800 180 2501
Fax: 0800 180 2501
  In Italy:
Tel: 800 789 917
Fax: 800 789 917
 

The US Prospectus, i.e. the prospectus dated April 13, 2010 and the prospectus supplement dated December 3, 2010 comprising the Invitation, are available on the SEC's website at http://www.sec.gov/.

Argentina has filed a registration statement (including the US Prospectus) with the SEC for the Invitation to which this communication relates and the offer and sale of any securities in the Invitation will be made in the United States by means of such registration statement. Before you participate in the Invitation, you should read the US Prospectus and other documents Argentina has filed with the SEC for more complete information about Argentina and this Invitation. You may get these documents for free by visiting EDGAR on the SEC website at http://www.sec.gov. Alternatively, the information, exchange and tabulation agent will arrange to send you the US Prospectus if you request it by calling one of the telephone numbers specified above.

JURISDICTIONAL RESTRICTIONS

General

This communication shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be a sale of the securities referenced in this communication in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

Argentina is making the Invitation only in those jurisdictions where it is legal to do so. The Invitation is void in all jurisdictions where it is prohibited. If materials relating to the Invitation come into your possession, you are required by Argentina to inform yourself of, and observe, all of these restrictions. The materials relating to the Invitation do not constitute, and may not be used in connection with, an offer or solicitation in any place where offers or solicitations are not permitted by law. Holders of Brady Bonds should carefully review the US Prospectus or the EU Prospectus, as applicable. Argentina has not authorized anyone to give holders any other information, and Argentina takes no responsibility for any other information that others may give to holders.

European Economic Area

This communication is an advertisement for the purposes of applicable measures implementing Directive 2003/71/EC of the European Parliament (such Directive, together with any applicable implementing measures in the relevant home Member State under such Directive, the "Prospectus Directive"). A prospectus prepared pursuant to the Prospectus Directive has been published, which can be obtained online at http://www.bondcom.com/argentina and by contacting the exchange and information agent. For answers to questions concerning the terms of the Invitation, holders may contact the information, exchange and tabulation agent at the telephone number mentioned above. Investors should not subscribe for any securities referred to in this document except on the basis of information contained in the Prospectus.

At the request of Argentina, the EU Prospectus has been approved by the competent authority in Luxembourg and "passported" into Germany and Italy. 

In relation to each other member state of the European Economic Area which has implemented the Prospectus Directive (each, a "Relevant Member State"), from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the "Relevant Implementation Date") an offer of the New Securities to the public in that Relevant Member State will not be made prior to the publication of a prospectus in relation to the New Securities which has been approved by the competent authority in that Relevant Member State or, where required, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except, with effect from and including the Relevant Implementation Date:

  • to qualified investors (as defined in the Prospectus Directive or implementing legislation in the Relevant Member State) ("Qualified Investors");
  • to fewer than 100 natural or legal persons (other than Qualified Investors); or
  • in any other circumstances which do not require the publication by the issuer of a prospectus pursuant to Article 3 of the Prospectus Directive.

For the purposes of this provision, the expression an "offer of New Securities to the public" in relation to any New Securities in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the New Securities to be offered so as to enable an investor to decide to purchase or subscribe the New Securities, as the same may be varied in that member state by any measure implementing the Prospectus Directive in that member state.
In any Relevant Member State that has implemented the Prospectus Directive other than Luxembourg, Germany and Italy, this communication is only addressed to and directed at Qualified Investors in that Relevant Member State.

Belgium

The Invitation does not constitute a public offering within the meaning of Article 3, §2 of the Belgian Law of June 16, 2006 on public offering of securities and admission of securities to trading on a regulated market (the "Prospectus Law") nor pursuant to Article 6 of the Belgian Law of April 1, 2007 on takeover bids (the "Takeover Law"). The Invitation is exclusively conducted under applicable private placement exemptions and has therefore not been, and will not be, notified to, and no Invitation Material has been, or will be, approved by, the Belgian Banking, Finance and Insurance Commission (Commission bancaire, financière et des assurances/Commissie voor het Bank-, Financie- en Assurantiewezen).

Accordingly, the Invitation as well as any Invitation Materials may only be advertised, offered or distributed in any way, directly or indirectly, to any person located and/or resident in Belgium who qualify as "Qualified Investors" as defined in Article 10, §1, of the Prospectus Law and as referred to in Article 6, §3, 2°, of the Takeover Law, and who are acting for their own account, or in other circumstances which do not constitute a public offering in Belgium pursuant to the Prospectus Law and the Takeover Law.

Canada (Ontario and Québec Only)

The New Securities may only be offered to investors located in the provinces of Ontario and Québec.
The Invitation will be made in Canada on a private placement basis only and will be exempt from the requirement that Argentina prepare and file a prospectus with the relevant Canadian securities regulatory authorities. Accordingly, any resale of the New Securities must be made in accordance with applicable securities laws that may require resales to be made in accordance with exemptions from registration and prospectus requirements. Tendering holders are advised to seek legal advice prior to any resale of the New Securities.

Each Canadian investor who participates in the Invitation will be deemed to have represented to Argentina that:

  • the Invitation was made exclusively through the Invitation Materials and was not made through this communication or any other advertisement of the Invitation in any printed media of general and regular paid circulation, radio, television or telecommunications, including electronic display, or any other form of advertising in Canada;
  • the investor has reviewed and acknowledges the resale restrictions referred to above;
  • where required by law, the investor is participating in the Invitation as principal for its own account and not as agent; and
  • the investor or any ultimate investor for which such investor is acting as authorized agent is entitled under applicable Canadian securities laws to participate in the Invitation without the benefit of a prospectus qualified under such securities laws, and without limiting the generality of the foregoing, the investor, or any ultimate investor for which such investor is acting as agent, is an "accredited investor", as that term is defined in National Instrument 45-106 - Prospectus and Registration Exemptions.

In addition, each recipient of New Securities resident in Ontario who receives an exchange confirmation, by the tendering holder's receipt thereof, will be deemed to have represented to Argentina that such tendering holder: (a) has been notified by Argentina (i) that Argentina is required to provide information ("personal information") pertaining to the tendering holder as required to be disclosed in Schedule I of Form 45 106F1 (including its name, address, telephone number and the number and value of any of the New Securities received), which Form 45 106F1 is required to be filed by Argentina under NI 45 106, (ii) that such personal information will be delivered to the Ontario Securities Commission (the "OSC") in accordance with NI 45 106, (iii) that such personal information is being collected indirectly by the OSC under the authority granted to it under the securities legislation of Ontario, (iv) that such personal information is being collected for the purposes of the administration and enforcement of the securities legislation of Ontario, and (v) that the public official in Ontario who can answer questions about the OSC's indirect collection of such personal information is the Administrative Assistant to the Director of Corporate Finance at the OSC, Suite 1903, Box 5520, Queen Street West, Toronto, Ontario M5H 3S8, Telephone: (416) 593-8086; and (b) by receiving New Securities, has authorized the indirect collection of the personal information by the OSC.

Further, the tendering holder acknowledges that its name, address, telephone number and other specified information, including the amount of New Securities it has acquired, may be disclosed to other Canadian securities regulatory authorities and become available to the public in accordance with the requirements of applicable laws. By acquiring New Securities, the tendering holder consents to the disclosure of such information.

Denmark

The Invitation and the Invitation Materials do not constitute a prospectus under Danish law and have not been filed with or approved by the Danish Financial Supervisory Authority as the Invitation and the Invitation Materials have not been prepared in the context of a public offering of securities in Denmark within the meaning of the Danish Securities Trading Act or any Executive Orders issued pursuant thereto. The Invitation will only be directed to qualified investors as defined in section 2 of the Danish Prospectus Order no. 223/2010. Accordingly, the Invitation and the Invitation Materials may not be made available to any other person in Denmark nor may the New Securities otherwise be marketed and offered for sale in Denmark.

France

No prospectus (including any amendment, supplement or replacement thereto) prepared in connection with the offering of the New Securities has been approved by the French Autorité des marchés financiers or by the competent authority of another State that is a contracting party to the Agreement on the European Economic Area and notified to the French Autorité des marchés financiers; no New Securities have been offered or sold nor will be offered or sold, directly or indirectly, to the public in France; the Invitation Materials relating to the New Securities have not been distributed or caused to be distributed and will not be distributed or caused to be distributed to the public in France; such offers, sales and distributions have been and shall only be made in France to qualified investors (investisseurs qualifiés) other than individuals investing for their own account, as defined in Articles L. 411-2, D. 411-1, D. 411-2, D. 734-1, D.744-1, D. 754-1 and D. 764-1 of the Code monétaire et financier. The direct or indirect distribution to the public in France of any so acquired New Securities may be made only as provided by Articles L. 411-1, L. 411-2, L. 412-1 and L. 621-8 to L. 621-8-3 of the Code monétaire et financier and applicable regulations thereunder.

Hong Kong

No person or entity may issue or have in its possession for the purposes of issue any advertisement, invitation or document relating to the New Securities, whether in Hong Kong or elsewhere, which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to New Securities which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" within the meaning of the Securities and Futures Ordinance (Cap.571) and any rules made thereunder.

Ireland

The Invitation is addressed exclusively to:

  • legal entities which are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;
  • any legal entity which has two or more of (i) an average of at least 250 employees during the last financial year, (ii) a total balance sheet of more than EUR 43,000,000 and (iii) an annual turnover of more than EUR 50,000,000 as shown in its last annual or consolidated accounts;
  • any other individual or entity authorized in Ireland as a qualified investor within the meaning of the Prospectus Directive;

and each person who initially acquires any New Securities or to whom any offer is made under the Invitation on the basis of any of the above will be deemed to have represented, acknowledged and agreed that it is a "qualified investor" within the meaning of Article 2(1)(e) of the Prospectus Directive and that it is not acquiring the New Securities with a view to their resale in Ireland to any person other than a qualified investor.

In the case of any New Securities being offered to a financial intermediary as that term is used in Article 3(2) of the Prospectus Directive, such financial intermediary will also be deemed to have represented, acknowledged and agreed that the New Securities acquired by it in the Invitation have not been acquired on a non-discretionary basis on behalf of, nor have they been acquired with a view to their offer or resale to persons in circumstances which may give rise to an offer to the public other than their offer or resale to qualified investors as so defined. Argentina will rely upon the truth and accuracy of the foregoing representation, acknowledgement and agreement.

"Prospectus Directive" means Directive 2003/71/EU of the European Parliament and the Council of November 4, 2003 and any relevant implementation measures in Ireland.

The Netherlands

The New Securities may not be offered or sold, directly or indirectly, in the Netherlands, other than to qualified investors (gekwalificeerde beleggers) within the meaning of Article 1:1 of the Dutch Financial Supervision Act (Wet op het financieel toezicht).

Portugal

The Invitation Materials have not been and will not be registered or approved by the Portuguese Securities Market Commission (Comissão do Mercado dos Valores Mobiliários) nor has a prospectus recognition procedure been commenced with the Portuguese Securities Market Commission, and therefore the Invitation is not addressed to investors resident and/or located in Portugal and cannot be made to the public in Portugal or under circumstances which are deemed to be a public offer under the Portuguese Securities Code (Código dos Valores Mobiliários) and other securities legislation and regulations applicable in Portugal. In addition, the Invitation Materials and other offer materials are only being publicly distributed in the jurisdictions where it is lawful to do so and may not be publicly distributed in Portugal, nor may any publicity or marketing activities related to the Invitation be conducted in Portugal.

The Invitation is not addressed to holders of Brady Bonds resident and/or located in Portugal, and no tenders from holders of Brady Bonds resident and/or located in Portugal will be accepted, other than to holders are that are qualified investors (investidores qualificados), as defined in articles 30 and 110-A of the Portuguese Securities Code, in which case the Invitation can be made through a private placement (oferta particular), in accordance with the relevant provisions of the Portuguese Securities Code.

Any future offer to present proposals for the repurchase of the Brady Bonds to be conducted in Portugal will not be registered or approved by the Portuguese Securities Market Commission nor will a prospectus recognition procedure be commenced with the Portuguese Securities Market Commission and therefore proposals for the repurchase of the Brady Bonds will not be accepted from the general public in Portugal under circumstances which are deemed to be a public offer under the Portuguese Securities Code and other securities legislation and regulations applicable in Portugal. 

Singapore

The Invitation is made only to and directed at, and the New Securities are only available to, persons in Singapore who are existing bondholders of bonds previously issued by Argentina. The Invitation is not an offer, sale or invitation of the New Securities to any other person in Singapore. Subscriptions for the New Securities will not be accepted from any person in Singapore other than persons in Singapore who are existing bondholders of bonds previously issued by Argentina.

Spain

Neither the New Securities nor the EU Prospectus have been approved or registered in the administrative registries of the Spanish Securities Market Commission (Comisión Nacional del Mercado de Valores). Consequently, the New Securities may not be offered in Spain except in circumstances which do not constitute a public offer of securities in Spain within the meaning of Article 30bis of the Spanish Securities Market Law of 28 July 1988 (Ley 24/1988, de 28 de julio, del Mercado de Valores), as amended and restated, and supplemental rules enacted thereunder, or otherwise in reliance of an exemption from registration available thereunder.

United Kingdom

This communication is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (iii) high net worth companies, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (e) of the Order (all such persons together being referred to as "relevant persons"). The New Securities are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such New Securities will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.