Factbox-Ukraine's sovereign and corporate debt crunch

By Rodrigo Campos

(Reuters) - Ukraine's state-owned gas company Naftogaz said it will default on its international bonds on Tuesday, making it the first government entity to face a hard default in the war-torn country.

Ukraine's economy and state finances have been hit hard by the Russian invasion on Feb. 24, with the government, squeezed by rising defense costs and dwindling tax revenue, asking creditors to defer payments on its sovereign international bonds.

Ukraine's largest state-owned agencies and enterprises, as well as private companies, have some $13 billion in international bonds outstanding. Some have already opted to ask, or are in the process of asking, creditors for a payment freeze.

Below is an overview over the debt situation of Ukraine's government and companies.

THE SOVEREIGN

Ukraine, which faces an acute liquidity squeeze and $5 billion-a-month fiscal gap, requested the holders of some $20 billion, across 11 dollar- and two euro-denominated bonds, to defer payments for at least two years. There is also some $2.6 billion in zero-coupon GDP warrants expiring in 2040 outstanding, according to JPMorgan, which were issued as part of the 2015 debt restructuring.

Ukraine had made all international debt payments since Russia's invasion. However, faced with a $1 billion maturity payment on Sept. 1, Kyiv asked creditors on July 20 for a two-year pay freeze across all its bonds and tweaks to the terms of the GDP warrants.

Russia calls its actions in Ukraine a "special operation."

Bondholders have until Aug. 9 to vote on the proposal, though some of its major holders have already indicated their support for the request.

Meanwhile, Western creditor governments - Canada, France, Germany, Japan, the United Kingdom and the United States - said on July 20 they would suspend Kyiv's debt servicing from Aug. 1 to the end of 2023 and potentially for an additional year.

NAFTOGAZ

State-owned gas firm Naftogaz said it would not make payments on international bonds before the Tuesday expiry of a grace period. The default may accelerate repayments on the two other Naftogaz bonds, but does not trigger a sovereign cross-default.

Issuing through Kondor Finance, Naftogaz has $1.45 billion in outstanding debt split in a euro-denominated $613 million maturing on July 2024, a dollar-denominated $500 million due November 2026, and a $335 million bond that matured last week and will be in default on Tuesday.

The company had twice made a request to the government to make the payment and both were rejected by Kyiv. Naftogaz also expects to formulate a new proposal to still try to win bondholders' approval.

UKRAVTODOR AND UKRENERGO

Ukravtodor, the state agency for roads, has a coupon payment on its $700 million 2028 note due Dec. 24 and a default there would cross to the sovereign. Ukrenergo is due a coupon payment in November on its 2026 $825 million bond. Kyiv said it asked holders of both bonds to also defer payments for two years.

METINVEST

The country's largest steelmaker, Metinvest, headquartered in Mariupol, owes $1.85 billion in one euro-denominated 2025 bond and four dollar bonds maturing between 2023 and 2029. Metinvest has metal and mining operations in Ukraine, Europe and the United States. It owns Azovstal iron and steel works, one of the main battlegrounds during the siege of Mariupol.

Fitch pointed to its weak liquidity and high operational risks in a recent note. Its ultimate parent is investment group SCM Holdings. Its owner, Rinat Akhmetov, Ukraine's richest person, said he would sue Russia for billions of dollars in damages.

DTEK

Also under the SCM Holdings umbrella are DTEK Energy and DTEK Oil & Gas Production. Ukrainian electricity and coal producer DTEK Energy in April received waivers from holders of its bonds due in March and June. DTEK is Ukraine's largest energy investor.

MHP

Chicken and grains processor MHP said in July it would resume interest payments on its bonds going forward.

Bondholders granted the company a reprieve on interest payments that had been due from March to May 2022, kicking in just days after Russia invaded Ukraine.

MHP has a $500 million bond outstanding with the next interest payment due in November. Two other external bonds from MHP expire in 2026 and 2029.

UPCOMING MATURITIES & PAYMENTS IN UKRAINE

RIC Name Maturity Next Pay Outstanding Ultimate Parent

UA202739393= KONDOR FINANCE 7/19/2022 $335,000,000 Kondor Finance

UA126182589= UKREXIMBANK 2/9/2023 8/9/2022 $20,833,333 USD Ukraine

UA127303371= OSCHADBANK 3/10/2023 9/10/2022 $70,000,000 USD Ukraine

GB127303363= SSB NO 1 3/10/2023 9/10/2022 $700,000,000 USD Ukraine

UA127303401= SSB NO 1 3/10/2023 9/10/2022 $70,000,000 USD Ukraine

UA180640053= METINVEST 4/23/2023 8/23/2022 $176,335,000 USD SCM Holdings

GB127885656= SSB NO 1 1/19/2024 1/19/2023 $18,750,000 USD Ukraine

55302TAD7= MHP 5/10/2024 11/10/2022 $500,000,000 USD WTI Trading

UA184343347= RAIL CAPITAL 7/9/2024 1/9/2023 $594,902,000 USD Rail Capital

UA202739423= KONDOR FINANCE 7/19/2024* 7/19/2023 €600,000,000 EUR Kondor Finance

UA201004098= KERNEL HLDG 10/17/2024 10/17/2022 $300,000,000 USD Kernel Hldg

UA206998024= DTEK RENEWABLE 11/12/2024 11/12/2022 €325,000,000 EUR System Cap Mngm

UA154303022= DTEK FIN 12/31/2024 $1,343,717,154 USD System Cap Mngm

UA126182562= UKREXIMBANK 1/22/2025 1/22/2023 $101,415,938 USD Ukraine

GB211420162= VFU FNDG 2/11/2025 8/11/2022 $412,485,000 USD Maples Intl

GB127303428= SSB NO 1 3/20/2025 9/20/2022 $53,990,000 USD Ukraine

UA127303444= OSCHADBANK 3/20/2025 9/20/2022 $150,000,000 USD Ukraine

UA127303479= SSB NO 1 3/20/2025 9/20/2022 $150,000,000 USD Ukraine

CY205672303= METINVEST 6/17/2025 12/17/2022 €299,100,000 EUR SCM Holdings

59318YAA6= MHP LUX 4/3/2026 10/3/2022 $550,000,000 USD WTI Trading

UA180640070= METINVEST 4/23/2026 10/23/2022 $493,871,000 USD SCM Holdings

CY233366471= INTERPIPE HLDG 5/13/2026 11/13/2022 $300,000,000 USD Interpipe Hldg

UA236512088= RAIL CAPITAL 7/15/2026 1/15/2023 $300,000,000 USD Rail Capital

GB207760161= KONDOR FINANCE 11/8/2026 11/8/2022 $500,000,000 USD Kondor Finance

63718LAA2= UKRENERGO 11/9/2026 11/09/2022 $825,000,000 USD Ukraine

CY223322751= METINVEST 10/1/2027 9/1/2022 $333,000,000 USD SCM Holdings

LU224492782= KERNEL HLDG 10/27/2027 10/27/2022 $300,000,000 USD Kernel Hldg

UA234293052= DTEK FIN 12/31/2027 9/30/2022 $1,688,111,732 USD System Cap Mngm

857329AA4= UKRAVTODOR 6/24/2028 12/24/2022 $700,000,000 USD Ukraine

CY201004489= MHP LUX 9/19/2029 9/19/2022 $350,000,000 USD WTI Trading

UA205672346= METINVEST 10/17/2029 11/17/2022 $500,000,000 USD SCM Holdings

GB201003920= BIZ FINANCE 11/14/2029 11/14/2022 $100,000,000 USD Ukraine

SOVEREIGNS IN RESTRUCTURING PROPOSAL

RIC Name Maturity Next Pay Date Outstanding

UA130392148= UKRAINE 9/1/2023 9/1/2022 $1,355,231,000 USD

UA130392121= UKRAINE 9/1/2022 $1,013,354,000 USD

UA130392504= UKRAINE 9/1/2024 9/1/2022 $1,339,057,000 USD

UA190217159= UKRAINE 2/1/2024 8/1/2022 $750,000,000 USD

UA130392547= UKRAINE 9/1/2025 9/1/2022 $1,328,887,000 USD

UA130392652= UKRAINE 9/1/2026 9/1/2022 $1,317,940,000 USD

UA130392717= UKRAINE 9/1/2027 9/1/2022 $1,307,161,000 USD

UA190217175= UKRAINE 11/1/2028 11/1/2022 $1,600,000,000 USD

UA201002869= UKRAINE 5/21/2029 11/21/2022 $1,750,000,000 USD

UA157795295= UKRAINE 9/25/2032 9/25/2022 $3,000,000,000 USD

UA201003083= UKRAINE 3/15/2033 9/15/2022 $2,600,000,000 USD

UA201526477= UKRAINE 6/20/2026 6/20/2023 €1,000,000,000 EUR

UA201003334= UKRAINE 1/27/2030 1/27/2023 €1,250,000,000 EUR

(Reporting by Rodrigo Campos in New York; Editing by Karin Strohecker, Mark Potter and Matthew Lewis)