A release posted held an hour ago on the Central Bank of Belize Website announced that Superbond 2.0 has been fully subscribed. That means the deal to renegotiate this huge chunk of Belize debt is now complete, all the bondholders have subscribed to the terms of the bond.
Within the next few days they will be given the new bonds in exchange for their old ones. How did it happen? Well, the bond offering went public 3 weeks ago - and the understanding then was that once 75% of the bondholders buy into the new terms, it would trigger what's known as the collective action clause, and force in all the remaining hold-outs.
Well, the release explains that, they got more than the 75%. It says, quote, "holders of 86.17 percent of the country's U.S. Dollar Bonds tendered their bonds…to exchange those instruments for new Belize U.S. Dollar Bonds."
That spells success, and significant debt relief for Belize. How much?
Well there's a 10% principal haircut off the top, amounting to a discount of $108 million dollars. And over the longer term, debt service reductions of $236 million dollars during the 5 year period between 2013 and 2017 and $494 million dollars during the 10 year period between 2013-2022, amounting to a reduction in net present value terms of over 43%.
The Superbond offering is expected to be formally closed next week.
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