Global law firm Hogan Lovells represented the Republic of Ecuador in one of the first-ever tests of “collective action clauses” in capital markets transactions, helping the country complete one of the largest international restructurings. The country, a long-time client of the firm, has faced the crippling effects of the coronavirus outbreak and historically low oil prices.
The firm put together a team comprised of lawyers from its Capital Markets, IERP, BRI, LAE, and Government Relations practices from several locations including New York, Miami, Houston, London, Mexico City, and Washington, D.C. to collaborate on the landmark restructuring of its US$17.4 billion of international bonds.
The transaction involved exchanging 10 existing international bonds maturing between 2022 and 2030 for three new bonds due in 2030, 2035 and 2040. Under the terms of the new bonds, interest payments will resume at the beginning of next year, while the earliest principal comes due in January 2026, a significant reduction in Ecuador’s debt burden.
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