12 Aug 2009 16:19

Talks with Naftogaz bond holders to begin next week

KYIV. Aug 12 (Interfax) - Naftogaz Ukrainy plans to begin talks next week with the holders of $500 million in Eurobonds concerning a restructuring, acting Finance Minister Igor Umansky told journalists in Kyiv on Wednesday.

"The first iteration of the talks will be with creditors next week," Umansky said.

Government representatives will be present at the talks.

Preparations for the possible restructuring are moving ahead "powerfully and at an accelerated pace," he said.

The talks will most likely include other Naftogaz creditors, specifically Deutsche Bank. Particular attention will be paid to hedge funds, which make up a considerable portion of the bondholders.

One of the companies vying to become Naftogaz's financial advisor in the foreign debt restructuring has proposed that other foreign creditors be included in the debt exchange program.

The foreign debt includes $220 million owed to Depha Bank, $550 million to CSI and $395.2 million to Deutsche Bank, which comes due in 2009-2012. Including the Eurobonds and accumulated interest, the total is about $1.78 billion, of which about $650 million payable this year and about $570 million payable next year.