By Karin Strohecker, Marc Jones and Rodrigo Campos
LONDON/NEW YORK, Jan 9 (Reuters) – A key group of Venezuelan bondholders said on Friday they were ready to start debt restructuring talks with the country once authorisation for such discussions was granted.
Venezuela’s default-hit government bonds have surged this week after the seizure of President Nicolas Maduro by the U.S. over the weekend fuelled hopes that one of the largest and most complex sovereign debt restructurings can start.
U.S. sanctions, however, prevent engagement with the Venezuelan government without a waiver or special license.
The “Venezuela Creditor Committee stands ready to initiate a negotiated (debt restructuring) process, when authorized,” the group, which includes GMO, Greylock Capital, Fidelity, T. Rowe Price, Mangart Capital and Morgan Stanley Investment Management, said in a statement.
TOTAL DEBT SEEN OVER $150 BILLION
Venezuela’s government and state oil firm PDVSA have defaulted on bonds with a combined face value of around $60 billion.
Total external debt, including other PDVSA obligations, bilateral loans and arbitration awards, stands at between $150 billion and $170 billion, analysts estimate, depending on how accrued interest and court judgments are counted.
“The VCC recognizes that the restoration of access to international private capital will be critical to Venezuela’s social and economic recovery, including in the oil sector,” the group added.
LONG TIME COMING
Attempts to make progress toward a debt restructuring have been stop-and-go as different U.S. administrations eased and tightened sanctions over the past decade.
The creditor group applied in late 2024 – during the administration of Trump’s predecessor Joe Biden – for a license to engage the Venezuelan government, according to two sources familiar with the matter.
One of the sources and a third source said key members of the group met in person with officials from the U.S. Treasury and its Office of Foreign Assets Control on the sidelines of the IMF/World Bank meetings in Washington last October.
Sources were granted anonymity to discuss private events and conversations.
One of the sources said creditor group advisers have continued to be in touch with OFAC since the October meeting. Reuters could not establish whether the group had met with U.S. authorities since Maduro’s capture.
OFAC did not immediately respond to a request for comment on the status of a license application.
VCC legal adviser Orrick had no further comment.
Separately, sources said British bank Barclays organised an investor meeting, also in Washington in October, with Venezuelan opposition leader Maria Corina Machado just days after she was awarded the Nobel Peace Prize.
She was speaking via video link from an undisclosed location and discussed her plans for Venezuela, including the economy and debt.
Barclays declined to comment.
(Reporting by Marc Jones, Karin Strohecker and Rodrigo Campos; additional reporting by Libby George; Editing by Rod Nickel)
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