Venezuela starts sovereign and PDVSA debt overhaul with liabilities seen above $150 billion
Venezuela has launched a sweeping overhaul of sovereign and PDVSA debt, with total liabilities reported above $150 billion. The government has opened formal talks with creditors and advisers. The process is expected to be one of the largest sovereign debt restructurings in Latin American history.
Venezuela has formally begun the process of restructuring its long-defaulted sovereign debt and the obligations of state oil company PDVSA, with total liabilities exceeding $150 billion, according to sources close to the creditor talks. The move is seen as a critical step in the country's bid to regain access to international capital markets.
The government has hired advisory firms to coordinate with creditor committees and has opened preliminary discussions with bondholders, who hold a significant portion of the PDVSA debt book. The US sanctions framework and claims against former Citgo assets stand out as central elements that will make the legal architecture extremely complex.
Analysts say any final deal is likely to involve substantial haircuts, long maturities and coupon payments tied to the country's oil revenues following a settlement. Investor meetings are expected to begin in the coming weeks, with an initial framework potentially emerging by year-end. Any deal would rank among the largest sovereign debt restructurings in Latin American history.
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