Argentina’s IRSA gives early results of exchange offer for 2023 notes

By Rebecca Melvin

Concord, N.H., June 3 – Argentina’s IRSA Inversiones y Representaciones SA announced the results as of the early participation date of its May 16 offer to exchange any and all of its $360 million principal amount outstanding of 8¾% series 2 notes due 2023 (ISINs: US463588AA16, USP5880UAB63) for new notes and a cash consideration, according to a company announcement.

The company is offering to exchange the series 2 notes, originally issued by IRSA Propiedades Comerciales SA, for new 8¾% senior notes due 2028 to be issued by IRSA.

As of 5 p.m. ET on June 2, $203,605,500 of the existing notes were validly tendered and not withdrawn, representing 56.56% of the outstanding aggregate principal amount of the existing notes.

Of that amount, $115,142,500, or about 56.55%, was tendered under option A, and $88,463,000, or roughly 43.45%, was tendered under option B.

If no additional notes are tendered after the early date, eligible holders will receive $530.49 of pro rata A cash consideration per $1,000 principal amount of existing notes tendered under option A. At expiration, the actual cash consideration will be determined on the basis of the actual participation in the exchange offer and the selection between option A and option B.

Tenders may no longer be withdrawn as of the early participation date.

Changes to payment

The exchange offer will expire at 5 p.m. ET on June 16 and is expected to settle on June 22.

Eligible holders who tender their notes on or before the expiration date, whether they tender before or after the early participation date, will now receive the same exchange consideration as holders who tendered their notes by the early deadline.

Options A and B

As previously reported, the two exchange offer options are mutually exclusive.

Under option A, tendering holders will receive new notes in a principal amount equal to 1.015 times the difference between $1,000 and the pro rata A cash consideration received by each eligible holder for each $1,000 principal amount of existing notes tendered and accepted for exchange.

The pro rata A cash consideration that will be payable to eligible holders will be equivalent to the A cash consideration divided by the principal amount of existing notes accepted under option A times 1,000.

The A cash consideration is an aggregate amount equivalent to the lesser of 30% of the aggregate principal amount of existing notes that are validly tendered and accepted and the principal amount of the existing notes accepted for exchange under option A.

Under option B, tendering holders will receive $1,030 principal amount of new notes for each $1,000 principal amount of existing notes tendered and accepted for exchange.

Tendering holders will be entitled to receive accrued interest from the interest payment date on March 23 to but excluding the settlement date.

Eligible holders of the existing notes who are Argentine entity offerees may be subject to certain tax withholdings resulting from the exchange of their existing notes.

Morrow Sodali International LLC (https://bonds.morrowsodali.com/IRSAEligibility) is acting as the exchange and information agent for the offer; and BCP Securities, Inc., Citigroup Global Markets Inc., Itau BBA USA Securities, Inc. and Santander Investment Securities Inc. are acting as dealer managers of the Rule 144A and Regulation S offer.

IRSA is a real estate company based in Buenos Aires.

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