Greek bond investors face month’s wait

Financial Times
September 12, 2011

Anxious debt investors will have to wait until mid-October for the much-anticipated results of the Greek debt exchange offer, aimed at cutting Greece’s heavy public debt burden.

The eventual offer will allow all holders of Greek debt to swap their Greek bonds maturing before 2020 for longer-dated paper, taking losses of about 21 per cent on their holdings in the process.

If fewer than 90 per cent of eligible Greek bonds are tendered for the offer, the Hellenic Republic, after consulting with European authorities, has the option of cancelling the entire exchange if its debt sustainability targets are not met.

But what is likely to be the world’s biggest ever liability management exercise, a type of debt restructuring often undertaken by companies, will proceed in a series of stages during the next month.

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