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Adviser Tapped for Venezuela's Massive Debt Restructuring
10 Feb
Summary
- Holders of Venezuela's defaulted sovereign bonds are nearing appointment of a financial adviser.
- The nation's total external debt is estimated between $150 and $170 billion.
- U.S. sanctions currently prevent engagement with Venezuela without special licenses.
A significant group of holders of Venezuela's defaulted sovereign bonds is set to appoint Houlihan Lokey as their financial adviser. This development marks a potential step towards restructuring Venezuela's substantial external debt, estimated to be between $150 billion and $170 billion. The nation and its state oil company, PDVSA, defaulted on approximately $60 billion in bonds in 2017.
The appointment follows renewed hopes for debt restructuring talks, spurred by U.S. actions against President Nicolas Maduro in early January. However, U.S. sanctions currently pose a barrier to direct engagement with the Venezuelan government, necessitating waivers or special licenses for any discussions.
The Venezuela Creditor Committee, whose members include major financial institutions, announced in January its readiness to commence restructuring talks once authorized. The committee's legal adviser, Orrick, declined to comment on the potential appointment of Houlihan Lokey.
