Panama Announces Pricing of Its Global Offering

May 5, 2017

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The Republic of Panama ("Panama") hereby announces that yesterday it priced a global offering (the "New Bonds Offering") of U.S.$253,988,000 aggregate principal amount of its 3.875% Global Bonds due 2028 (the "2028 New Bonds") and U.S.$1,168,292,000 aggregate principal amount of its 4.500% Global Bonds due 2047 (the "2047 New Bonds" and together with the 2028 New Bonds, the "New Bonds").  

The 2028 New Bonds will be consolidated and form a single series with, and be fungible with, the outstanding U.S. $1,000,000,000 3.875% Global Bonds due 2028 (CUSIP 698299 BF0, ISIN US698299BF03, Common Code 138083179), previously issued by Panama.

The aggregate principal amount of New Bonds includes approximately U.S.$103,988,000 of 2028 New Bonds and U.S.$118,292,000 of 2047 New Bonds intended to fund the purchase of outstanding debt in the concurrent tender offer described below, and the amount may be adjusted based on final acceptances in the tender offer. The closing of the New Bonds Offering is expected to occur on Monday, May 15, 2017.

Merrill Lynch, Pierce, Fenner & Smith Incorporated and Morgan Stanley & Co. LLC served as Joint Lead Underwriters for the New Bonds Offering.

The New Bonds Offering was made only by means of a preliminary prospectus supplement and an accompanying base prospectus. Copies of the preliminary prospectus supplement, the final prospectus supplement (when filed) and the related base prospectus for the New Bonds Offering may be obtained by contacting Merrill Lynch, Pierce, Fenner & Smith Incorporated, by calling 1-800-294-1322 (U.S. toll free); or Morgan Stanley & Co. LLC, by calling 1-800-624-1808 (U.S. toll free).

Application will be made to have the New Bonds listed on the Luxembourg Stock Exchange and admitted to trading on the Euro MTF Market of the Luxembourg Stock Exchange.

Tender Offer

Panama previously announced an offer to purchase for cash (the "Tender Offer") its outstanding 5.200% Global Bonds due 2020 (the "Old Bonds") in an aggregate principal amount that will not result in an aggregate Purchase Price that exceeds an amount determined by Panama in its sole discretion (the "Maximum Purchase Amount"), subject to the terms and conditions contained in the Offer to Purchase, dated May 3, 2017 (the "Offer to Purchase").  The Tender Offer expired as scheduled, with respect to Non-Preferred Tenders, at 12:00 noon, and, with respect to Preferred Tenders, at 4:00 p.m., New York Time, yesterday. All capitalized terms used but not defined under the heading "Tender Offer" in this communication have the respective meanings specified in the Offer to Purchase.

Panama has instructed Merrill Lynch, Pierce, Fenner & Smith Incorporated, as the Billing and Delivering Bank for the Tender Offer, to accept subject to proration and other terms and conditions contained in the Offer to Purchase, valid Preferred Tenders and Non-Preferred Tenders in the aggregate principal amounts as set forth below. 

The Maximum Purchase Amount is U.S.$345,473,000.

The aggregate principal amount of Preferred Tenders and Non-Preferred Tenders and the aggregate principal amount of Preferred Tenders and Non-Preferred Tenders that have been accepted are shown in the table below. The Billing and Delivering Bank has accepted Old Bonds with appropriate adjustments to avoid purchase of Old Bonds in principal amounts other than Permitted Tender Amounts.

The settlement of the Tender Offer is scheduled to occur on Thursday, May 11, 2017 (the "Tender Offer Settlement Date"), subject to change without notice.  Failure to deliver Old Notes on time may result, in Panama's sole discretion, in any of the following,  the cancellation of a tender and the investor's becoming liable for any damages resulting from that failure, and/or the delivery of a buy-in notice for the purchase of such Old Notes, executed in accordance with customary brokerage practices for corporate fixed income securities, and/or in the case of Preferred Tenders, the cancellation of a tender and the investor's remaining obligated to purchase his or her allocation of New Notes in respect of his or her related Indication of Interest.  Panama reserves the right, in its sole discretion, not to accept any or all Tender Orders and to terminate the Tender Offer for any reason.

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