CARACAS, Sept 14 Venezuelan state oil company
PDVSA's bonds rose on Wednesday following a $7 billion debt swap
proposal that could offer financial relief for the cash-strapped
company that is struggling under low crude prices.
PDVSA on Tuesday announced a plan to replace bonds maturing
in 2016 and 2017 with a new bond maturing in 2020 that will be
backed by shares in its U.S. refining unit Citgo, with full
details of the proposal expected to be released soon.
The company's bonds rose across the board. The PDVSA 2017N
bond, which is part of the swap offer, was up 2.6
points to a bid price of 79.15, its highest since September
Venezuela's sovereign bonds on average rose to two-year
highs, according to JPMorgan's EMBI Global Diversified Index
Wall Street analysts consulted about the offer said they
needed more details to fully evaluate it.
After months of fretting about a possible default, investors
in recent months have grown more optimistic that the OPEC nation
will meet debt payments despite an economic crisis that has
spawned triple-digit inflation and chronic product shortages.
President Nicolas Maduro notes that the ruling Socialist
Party has never missed a bond payment and calls default
speculation a smear campaign by adversaries to weaken his
(Reporting by Brian Ellsworth Editing by W Simon)