Petróleo Brasileiro S.A. - Petrobras (NYSE:PBR), the Brazilian state-controlled oil company, announced today that it will redeem €271,945,000 in outstanding 4.750% Global Notes due in 2025. The company's wholly-owned subsidiary, Petrobras Global Finance B.V. (PGF), has issued redemption notices to the note holders, with the redemption date set for July 29, 2024.
The redemption price will be the greater of the full principal amount or a sum calculated based on the present value of remaining payments of principal and interest, discounted to the redemption date using a specified Bund Rate plus 40 basis points, plus accrued interest from January 14, 2024, until the redemption date. The exact Euro Make-Whole Amount will be determined and disclosed to note holders three business days before the redemption date.
Payments to note holders will be made by The Bank of New York Mellon (NYSE:BK), the trustee, through credit to the account of The Bank of New York Mellon, London Branch, the common depositary for Clearstream and Euroclear. The payment will be executed before noon, London time, on the business day before the redemption date.
After the redemption date, the notes will be delisted from the Luxembourg Stock Exchange, and all rights and obligations under the notes and related guarantees by Petrobras will be cancelled and extinguished. PGF plans to use available cash on hand to fund the redemption.
Petrobras's investor relations department is available for any questions regarding the redemption process. This announcement is based on a press release statement and contains forward-looking statements, which are subject to risks and uncertainties. Petrobras has not committed to updating any forward-looking statements as new information becomes available or otherwise.
In other recent news, significant developments have occurred for both Venezuela and Petrobras. Venezuela's international bondholders, including asset managers such as Grantham, Mayo, Van Otterloo & Co. LLC, Greylock Capital, Mangart Capital, and Fidelity Investments, have appointed Orrick, Herrington & Sutcliffe LLP as legal advisors for anticipated debt restructuring. This follows Venezuela's default on its international debt in 2017, which encompasses around $60 billion owed by the government and the state oil company PDVSA.
Turning to Petrobras, the company posted strong Q1 2024 results, reporting a net profit of $4.8 billion and an adjusted EBITDA of $12.1 billion. However, the company has seen significant changes in leadership, with CEO Jean Paul Prates offering to resign and former energy regulator Magda Chambriard expected to take over the position. This change has led to analyst downgrades and adjustments in stock target prices from financial research firms such as CFRA and Jefferies.
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