BONDHOLDERS’ MEETING DEFERRED TO NOV 13

BUUMBA CHIMBULU writes
@SunZambian
BONDHOLDER meetings to vote on Zambia’s request for debt relief which were supposed to take place have been postponed to November 13, 2020 after failing to reach quorums.
Government is currently undertaking the debt restoring process and has therefore engaged bondholders to request for debt relief due to the limited fiscal space.
“The t meetings of holders of its (i) US$750,000,000 5.375 per cent. Notes due 2022, (ii) U.S.$1,000,000,000 8.500 per cent. Notes due 2024 and (iii) U.S.$1,250,000,000 8.970 percent.
“Notes due 2027 held today have been adjourned for lack of quorum and that the adjourned meetings will be held on 13 November 2020,” said Secretary to the Treasury, Fredson Yamba, in a statement last Tuesday.
Mr Yamba said Government remained committed to finding a consensual and collaborative resolution to the fiscal and debt sustainability issues it was currently facing
In light of this, he explained, the Government remained open to dialogue with the ad hoc committee of Note holders and other creditors to agree a resolution that would gather support from creditors.
And Bloomberg reports that Kevin Daly, a London-based portfolio manager at Aberdeen Standard Investments in London, which holds Zambian Eurobonds, said it had no visibility on the use of proceeds if they agreed to a debt standstill.
“We have no clarity on how they intend to restructure their Chinese debt, we have no fiscal framework to ensure debt sustainability, and they are unlikely to reach a deal with the IMF ahead of the elections,” Kevin Daly said yesterday before the start of the meeting before it was postponed.
Bloomberg reports that November 13, 2020 is also the deadline to make a coupon payment that Zambia skipped on October 14, before it triggered a default that will give bondholders the right to demand immediate repayment of the principal.
Zambia said last month it won’t be able to meet obligations without a six-month interest-standstill agreement.