Houlihan Lokey to
advise Eurobond holders

Heavy haircut on debt expected

The Ad Hoc Lebanon Bondholders Group have appointed Houlihan Lokey as financial adviser ahead of a revival of debt restructuring discussions, which are anticipated to take part later this year. The appointment comes five years after Lebanon first ever default. Initial restructuring negotiations followed but faltered in 2022 after the government failed to reach an agreement with International Monetary Fund. All current expectations of a debt restructuring are suggesting heavy losses for creditors.

Five other firms had pitched in early March to the ad hoc group of bondholders. They include Rothschild, Newstate, Alvarez & Marsal, GSA, and Centerview. Houlihan Lokey and GSA were shortlisted.

Legal counsel for the bondholders is being provided by White & Case. Lazard and Cleary Gottlieb are advising the Lebanese government.

The Ad Hoc Lebanon Bondholders Group, which was established immediately following the default in 2020, is currently comprised of Amundi Asset Management, Ashmore Group, BlackRock Financial Management, BlueBay Asset Management LLP, Fidelity Investments, GMO, Greylock, Mangart Capital Management Ltd, Morgan Stanley Investment Management, and Neuberger

As the 2022 negotiations between the government and the IMF stalled, the value of the defaulted Eurobonds fell sharply and traded below six cents on the dollar at it slowest point. However, recent developments have seen these bonds trading at 17-19 cents, reflecting renewed optimism following changes in political leadership.