UPDATE 1-Venezuela PDVSA bond prices slip after debt swap again extended

jueves 13 de octubre de 2016 15:29 GYT
 

(Adds comments about central bank president)

By Alexandra Ulmer and Corina Pons

CARACAS Oct 13 (Reuters) - Venezuelan state oil producer PDVSA's bond prices dropped on Thursday after the company again extended a deadline for its $5.3 billion debt swap offer, suggesting investors may be hesitant to partake.

PDVSA on Wednesday night moved the date for both the early deadline and the expiration to Oct. 17, from Oct. 12 and Oct. 14, respectively.

The swap requires more than 50 percent participation to go through.

"It's illogical that PDVSA extends again the deadline without improving the terms and will eventually have to make a decision to go ahead with less than 50 percent participation or suspend the transaction," said Siobhan Morden with Nomura Securities International.

If low participation scuttles the swap, investors may lose their recently gained optimism that PDVSA can avoid defaulting on its heavy bond obligations. The company is struggling with low oil prices, slumping production and an extreme cash flow deficit that has left it unable to pay contractors on time.

President Nicolas Maduro has insisted Venezuela and PDVSA will make all debt payments and dismissed default talk as part of a politically motivated campaign against his socialist government.

Sources said central bank president Nelson Merentes reiterated Venezuela's willingness to pay in a rare private meeting with two dozen investors on the sidelines of the IMF/World Bank meetings in Washington last week.   Continuación...