Details Emerge on New TGN Debt (1)

Argentina’s Transportadora de Gas del Norte (TGN) has disclosed the details of the new debt included in an exchange offer launched last week. The gas company plans to issue as much as $170m in new 2019 bullet step-up notes, paying 3.5% through the first 2 years, 7.0% through the second 2 years and 9.0% during the remainder, according to a company official. Up to $174m in claim protection notes pay no coupon and are due after one year, unless there is a credit event. TGN said last week it would exchange any and all of its $141m outstanding in 9.52% 2012 bonds and $204m outstanding in 9.45% 2012 bonds, for the new notes and cash. In the offer, accepting holders receive, for each $1,000 principal, $494.20 in new step-up notes, $164.68 in new claim protection notes, and $280 in cash. Holders accepting before an August 8 early date receive an additional $49.45 in cash per $1,000. The offer expires August 17, and is contingent upon a minimum 88% acceptance. Barclays is managing. TGN defaulted on its debt in 2008.