Venezuela’s state-owned oil company says it won’t pay bond investors any more than face value to exchange their debt for longer-maturity notes. Instead, it proposes offering half its U.S. refining arm as collateral.
Petroleos de Venezuela SA will offer to swap $7 billion of bonds maturing in April and November next year for new 8.5 percent notes with payments staggered over the next four years. The new bonds will be backed by a 50.1 percent stake in Citgo Holding Inc., the unit that owns its U.S. refining arm.
