Alternative to Government Bonds: Fintech Company Activitis Issued Corporate Bonds

Fintech company Activitis, in collaboration with investment firm UNIVER, has announced the issuance of corporate bonds with a public offering of Series "B" worth 300 million UAH. This issuance introduces a new model to the Ukrainian market.

Key Information:

• The nominal yield of the bonds is 20% per annum in UAH, while the effective yield (considering reinvestment) is 21.55% per annum in UAH. This makes them an attractive alternative to government bonds.
• Purchase applications for bonds can be submitted until 2:00 PM on February 20, 2025. To apply, investors should contact their broker or the placement organizer—investment firm "UNIVER Capital."
• Bond purchase and sale transactions will be executed on the "PFTS" stock exchange on February 20, 2025.

Starting March 1, 2025, bond trading will also be available on the secondary market.

What Does This New Issuance Model Mean for the Ukrainian Market?

1. For the first time in Ukraine's bond market, the issuance consists of two parts: a Base Prospectus and Final Terms. The Base Prospectus contains all issuer-related information and remains valid for a year, while the Final Terms are approved separately for each issuance, specifying the key parameters. This structure allows issuers to execute subsequent bond issuances quickly—if demand is high, a new issuance can be registered within a week, compared to up to six months under the traditional structure.

2. Thanks to new bond issuance regulations from the National Securities and Stock Market Commission (NSSMC), even if only one bond is sold in the primary offering, the issuance can be registered as completed. The unsold portion of the bonds can then be sold by the issuer on the secondary market after registration. This NSSMC innovation simplifies and accelerates the placement process, providing confidence to both issuers and investors that the issuance will be registered on time without the need for "technical placements."

3. The primary placement introduces the Delivery versus Payment (DvP) principle, ensuring simultaneous bond transfer and payment processing. While this mechanism existed before, it was not widely used due to the complexity and unpredictability of the placement process. Thanks to NSSMC's process simplification, the DvP principle can now be applied, significantly enhancing transaction security and reducing the issuance registration period from 25 to 5 business days.

Fintech company Activitis has been developing financial products for micro, small, and medium-sized enterprises since 2013. The company was the first in Ukraine to launch innovative installment-based financial services for businesses—WEAGRO and eDilo, advancing the country's B2B sector.

Source: https://fintechinsider.com.ua/alternatyva-ovdp-finteh-kompaniya-activitis-vypustyla-korporatyvni-obligacziyi/