Milbank Acts on Successful Exchange Offer and New Issuance by the Government of Mongolia

HONG KONG, March 14, 2017 /PRNewswire/ -- Milbank, Tweed, Hadley & McCloy LLP advised Credit Suisse and J.P. Morgan as dealer managers and initial purchasers in a US$600 million sovereign bond exchange offer and new issuance by the Government of Mongolia.

The transaction was successfully completed amid highly challenging economic circumstances. Mongolia has faced potential liquidity issues over the past year related to slower economic growth, mainly as a result of the country's dependence on commodities which have suffered from slumping prices. Initially the Government was able to secure preliminary approval from the International Monetary Fund ("IMF") for a package of relief measures, which gave the exchange offer and new issue strong momentum in the market.

Despite challenges which included an extremely tight deadline, the ongoing IMF discussions and rapidly approaching maturity of the Development Bank of Mongolia ("DBM") bonds in March 2017, the transaction was successfully completed on very favorable terms that achieved all of the Government's objectives. Approximately $476 million in new sovereign Government bonds were exchanged for outstanding DBM bonds, while an additional $124 million in new Government bonds were issued for cash.  Holders of more than 80% of outstanding DBM bonds agreed to remain in the credit by exchanging for new Government bonds at a yield of 8.75%. Meanwhile new Government bonds were issued for cash at a premium of 106.016%, with the proceeds to be used for further repurchases of remaining DBM bonds.

Capital Markets partner Jim Grandolfo led the Hong Kong-based Milbank team, which included counsel Paul Pery, senior associate Kurt Sherwood and associates Adam Heyd and York Wu.

Mr. Grandolfo commented: "Despite the challenging economic conditions, the Government of Mongolia, with the assistance of our clients Credit Suisse and J.P. Morgan, was able to successfully address the concerns of the IMF and its international investor base to achieve their objectives, all within a limited timeframe. This marks an incredible turnaround for the Government and the country of Mongolia, providing what we hope will be a strong basis for long-term, sustained economic recovery. We are pleased to support our clients Credit Suisse and J.P. Morgan and the Government of Mongolia on a transaction of such national importance."

About Milbank
Milbank, Tweed, Hadley & McCloy LLP is a leading international law firm that provides innovative legal services to clients around the world. Founded in New York 150 years ago, Milbank has offices in Beijing, Frankfurt, Hong Kong, London, Los Angeles, Munich, São Paulo, Seoul, Singapore, Tokyo and Washington, DC. Milbank's lawyers collaborate across practices and offices to help the world's leading commercial, financial and industrial enterprises, as well as institutions, individuals and governments, achieve their strategic objectives. For more information please visit www.milbank.com.

From:  Jocelyn De Carvalho, Public Relations Manager; 212-530-5509; jdecarvalho@milbank.com