Weil has advised the ad hoc committee of bondholders in connection with the agreement reached today between the steering committee of the ad hoc committee of bondholders (the Steering Committee) and the Government of Zambia on a restructuring of Zambia’s sovereign bonds due 2022, 2024 and 2027.

The Restructuring will be implemented through an exchange offer and/or consent solicitation. Implementation of the restructuring remains subject to agreement between the Government and the Steering Committee on the definitive legal documentation for the new bonds and exchange offer and/or consent solicitation. The proposed agreement will provide the Government with significant cash flow and debt stock relief to support a restoration of macro-economic and debt sustainability in the context of the IMF-financed program and cure the long-standing default on the Eurobonds. The agreement includes an innovative solution to address the constraints faced by the Government. As part of the restructuring, bondholders will be issued two new bonds. One of these is a “Step-Up Bond.” It is a new concept that allows the bond to “step-up” to enhanced repayment terms and higher coupons when specific trigger events are met.

The ad hoc creditor committee was advised by Weil, Gotshal & Manges (London) LLP.

Andrew Wilkinson, Co-Head of Weil’s London Restructuring practice who led the Weil team said “We are pleased to have advised the ad hoc committee of bondholders on the recent restructuring of Zambia’s sovereign bonds in the first full Common Framework debt restructuring, which provides the Zambian Government with significant cash flow and debt stock relief.”

The Weil team also involved counsel Kirsten Erichsen and associate Wupya Nandap.