The reoffering will raise the volume issued to $1.25 billion of the bond which matures on March 29, 2041, and has a 7.625% coupon.
The spread narrowed 60 compared to the first offering of the bonds — the longest foreign bond issued to date by the Republic of Hungary — late March.
Oversubscription was more than fivefold, and the issue price of the reoffering came to 104.417% as compared to the 98.084% price of the first offering in March, AKK said.
According to earlier information, the 30-year bond attracted demand of about $3 billion in the March offering where AKK sold $750 million of the bonds.
The current transaction raises the volume issued under Hungary’ recently acquired mandate from the United States Securities and Exchange Commission (SEC) to $4.25billion. This leaves room for probably one more $issue, given the $5 billion limit of the SEC mandate granted in February 2011.
The reoffering came shortly after Hungary placed a combined $3.75 billion of bonds, including $3 billion of ten-year bonds and $750 million of the presently reopened 30-year bonds, in a global placement on March 24.
The ten-year bond matures on March 29, 2021, carries a coupon of 6.375% and was priced at 99.062% to yield 310bp over US treasuries.
With the reoffering, worth about €350 million at the current exchange rate, and the March placement worth about €2.65 billion the government debt manager has completed 75% of its gross foreign issue plan for the year.
AKK planned to issue €4 billion of foreign currency bonds this year, enough to cover the €2 billion bonds maturing this year as well as a €2 billion repayment due the European Commission in November. The repayment is the first on principal of a IMF-led standby loan Hungary signed for in November 2008, at the height of the global financial crisis. The two foreign currency bonds, of €1 billion apiece, mature in June and in October.
Producing journalism that is worthy of the name is a costly business. For over 30 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.
