London Stock Exchange welcomes Uzbekistan's inaugural international sovereign bond issue

Following an extensive marketing exercise in New York, Boston and London, the Republic of Uzbekistan (acting through the Ministry of Finance of the Republic of Uzbekistan) successfully priced its inaugural US$1 billion dual-tranche bond offering on 13 February 2019. The 144A / Reg S offering was formed by a dual US$500mm 4.750% tranche due February 2024 and a US$500mm 5.375% due February 2029.

The strong orderbook response peaked in excess of ~ US$8.5bn, allowing the Republic to proceed with a firm price revision and launch the transaction at 4.750% and 5.375% yield for the 5-year and 10-year tranches respectively (down from initial price thoughts of 5.375% area and 6.000% area). 

The issue was heavily oversubscribed and well diversified, as final books stood at US$3.8bn, with around 150 institutional investor orders. In terms of geographical distribution, the 5- and 10-year tranches saw UK investors taking 39% and 32% respectively, whilst US investors had 23% and 31%, Continental European 32% and 27%; and Asian & MENA investors took the remaining 6% and 10% respectively.

By investor type, 75% and 78% of the allocations went to Asset Managers and Funds, 20% and 16% to Insurers, Pension Funds & Sovereign Wealth Funds; whilst Banks and Private Banks took 5% and 6% of the 2024 and 2029 bonds respectively.

The success of the debut Eurobond issue reflects investors’ confidence in Uzbekistan’s solid economic fundamentals, reforms progression and debt management strategy.

The key transaction achievements:

  • Inaugurated Uzbekistan’s presence in the Eurobond market with the landmark highly successful transaction
  • Strong investors support resulting in bold price revision and final pricing inside Uzbekistan’s higher rated peers
  • Establishment of a direct benchmark yield curve for future Eurobond issuances by Uzbekistan’s SOEs and other corporates and financial institutions
  • First CIS Sovereign bond offering in 2019

J.P. Morgan acted as Global Coordinator & Joint Bookrunner; Citi acted as Joint Bookrunner, Fiscal and Transfer Agent and Registrar; whilst Gazprombank acted as Joint Bookrunner. White & Case LLP and Centil Law Firm acted as the issuer's Legal Counsel and Linklaters LLP and Kinstellar acted as arrangers’ Legal Counsel.

Summary New Issue Terms

Issuer:

The Republic of Uzbekistan acting through the Ministry of Finance of the Republic of Uzbekistan

Ratings:

BB- (S&P), BB- (Fitch)

Global Coordinator

JP Morgan (B&D)

Joint Bookrunners:

Citigroup, Gazprombank and JP Morgan

Maturity Date:

20 February 2024

(5-year)

20 February 2029

(10-year)

Issue Amount:

US$500mm

US$500mm

Coupon:

4.750%

S/A

30/360

5.375%

S/A

30/360

Spread to Benchmark:

+222.1bps

+266.4bps

Re-offer Price:

100%

100%

Re-offer Yield:

4.750%

5.375%


This announcement may not be distributed, taken or transmitted in or into the United States, its territories or possessions or any other jurisdiction in which to do so would be unlawful and any forwarding, distribution or reproduction of this announcement in whole or in part is unauthorised. Failure to comply with this notice may result in a violation of the United States Securities Act of 1933, as amended (the "Securities Act"), or the applicable laws of other jurisdictions.

This announcement is not an offer of securities for sale in the United States.  Any securities referred to herein have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States and may not be offered or sold in the United States unless such securities are registered under the Securities Act or are offered and sold pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with state securities laws. any public offering of securities to be made in the United States will be made by means of a prospectus that may be obtained from the Issuer and that will contain detailed information about the Issuer.

The information contained herein shall not constitute or form part of any offer to sell or solicitation of an offer to buy, nor shall there be any sale of the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction.

This communication does not constitute an offer of securities to the public in the United Kingdom. Consequently, this communication is directed only at (i) persons who are outside the United Kingdom, (ii) persons who have professional experience in matters relating to investments falling within Article 19(1) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”), (iii) high net worth entities falling within Article 49(2) of the Order and (iv) other persons to whom it may lawfully be communicated (all such persons together being referred to as “relevant persons”).  Any investment activity to which this communication relates will only be available to, and will only be engaged with, relevant persons.  Any person who is not a relevant person should not act or rely on this document or any of its contents.

In any EEA Member State that has implemented the Prospectus Directive, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive.  The "Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including Directive 2010/73/EU, to the extent implemented in that Member State), and includes any relevant implementing measures in that Member State.

Quick facts

Track
Market: Main Market
Instrument market cap (£m)
-
Listing/Admission to trading
20 Feb 2019
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