Concorde Capital Research: JKX gets approval for three-year bond restructuring

January 04, 2017 - Cbonds


The creditors of JKX Oil & Gas (JKX LN) approved a postponement of maturity of USD 16 mln in bonds that were otherwise callable in February 2017. The company said on Jan. 3 that 88.75% of bondholders voted in favor of restructuring (as compared to the minimum threshold of 75%). As a part of the deal, JKX will increase coupon payments to 14% from 8% previously, and will repay the notes in three equal annual installments starting February 2018. In February 2017, the company will pay USD 2.6 mln in scheduled interest and accretion payments.

Alexander Paraschiy: The news comes as little surprise, given that on the day of the restructuring announcement (Dec. 9), JKX reported it had the backing of 72.5% of votes in approval. The development is positive for JKX as it will save critical liquidity and enable it to execute its CapEx program.

At the same time, we look forward to hearing some more important news from the international arbitration front. JKX is demanding over USD 180 mln in compensation from the Ukrainian government for overpaid taxes. The decision was previously anticipated by the end of 2016, though JKX reported last week that it has yet to receive it.
Issuer: JKX Oil & Gas
Issuer profile:
The company explores, mines and produces oil and gas.
Outstanding issues:
1 issuesUSD40,000,000