(Adds more details from prospectus)
CARACAS, Sept 16 Venezuela's state oil company
PDVSA launched on Friday an offer to swap up to $7.1 billion of
debt maturing next year for a new 2020 bond with a coupon of 8.5
percent in an effort to ease its heavy short-term payment
"Holders of eligible bonds, maturing in April and November
of 2017, will have 20 days to exercise their option to
participate in this excellent investment opportunity," the
company added in a statement.
PDVSA, which is the financial motor for the socialist
government given that oil accounts for 94 percent of Venezuela's
export revenues, added that the 2020 bond would be backed by
50.1 percent of shares in its U.S. refining unit Citgo.
After long fretting about possible default, investors in
recent months have grown more optimistic the OPEC member will
meet debt payments despite an economic crisis that has spawned
triple-digit inflation and chronic product shortages.
President Nicolas Maduro notes the ruling Socialists, in
power since Hugo Chavez's government from 1999, have never
missed a bond payment and calls default rumors part of a
U.S.-backed smear campaign by adversaries to weaken his
Amortizations for the 2020 bond will be paid annually over
four years, PDVSA added. Its statement can be seen in Spanish
In a prospectus on its web site, PDVSA said the 20 weekdays
of the offer would expire on Oct. 14, though the company
reserved the right to extend that.
Results would be given on Oct. 17, with the bonds issued on
Oct. 19, according to the preliminary timetable. Offers must be
over $150,000. The agent in charge of the swap is D.F. King & Co
and the fiduciary Union Bank, the prospectus added.
PDVSA said its total debt up to June 30, 2016, stood at
(Reporting by Diego Ore and Andrew Cawthorne; Editing by Alan
Crosby and Diane Craft)