Clifford Chance Leads Sri Lanka's Sovereign Bond Exchange

COLOMBO (News 1st); Global law firm Clifford Chance, in collaboration with financial advisor Lazard, has successfully advised the Government of the Democratic Socialist Republic of Sri Lanka on the execution of its sovereign bond exchange offer.

This marks the culmination of a multiyear effort to restore debt sustainability following the country's moratorium in April 2022.

The sovereign bond exchange offer, noted as one of the most complex in recent years, introduced several innovations to the sovereign debt restructuring framework.

These included the issuance of macro-linked bonds and governance-linked bonds, with Clifford Chance providing legal structuring and drafting expertise.

The final distribution of new bonds from the holding period arrangement was completed on February 27, 2025.

Clifford Chance partner Deborah Zandstra, who led the mandate, expressed gratitude for the opportunity to support Sri Lanka over the past two and a half years. She acknowledged the close collaboration with Sri Lankan authorities, the IMF country team, and the Paris Club Secretariat throughout the process.

The core team assisting Zandstra included partner Jon Zonis and senior associates James Kelton and Sophie Wilkinson, with additional support from lawyers across the Clifford Chance network.

Clifford Chance has also played a pivotal role in advising Sri Lanka on its broader sovereign debt restructuring process.

This included domestic debt restructuring, agreements with official bilateral creditors, and commercial creditors such as the China Development Bank.

The firm's efforts were conducted in collaboration with the Official Creditor Committee at the Paris Club and IMF staff as part of Sri Lanka's IMF-Supported Program. The IMF Executive Board approved the Third Review of this program on February 28, 2025.