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Ukraine Isolates Russia With Sweeter Terms to Deter Holdouts

  • New terms meet demands of bondholders threatening to dissent
  • Shortest-dated bonds rally most in two weeks on deal
Updated on

Ukraine amended the terms of an $18 billion restructuring to meet the demands of a group of rebel investors who threatened to derail the process, increasing the likelihood that all bondholders except Russia will approve the deal.

The eastern European nation offered to swap the $500 million note that matured on Wednesday and a euro-denominated security due in October into a new bond that will be redeemed in 2019. That complies with the request of a group of creditors owning at least 25 percent in the shortest-dated debt, who argued that previous allocations were biased against them because they had to wait longer for repayment than other investors. The bonds rallied.