Clifford Chance Advises Sri Lanka on Sovereign Debt Restructuring.
Clifford Chance, alongside financial advisor Lazard, has successfully advised the Government of Sri Lanka on its sovereign bond exchange offer, marking a pivotal moment in the country's multi-year debt restructuring process.
This marks the final step in a comprehensive effort to restore Sri Lanka’s debt sustainability following a moratorium in April 2022.
Innovative Debt Restructuring Process
The sovereign bond exchange offer, which is one of the most complex in recent years, introduced several innovations to sovereign debt restructuring. Notably, the offer included the issuance of macro-linked bonds and governance-linked bonds.
Clifford Chance played a key role in advising on the legal structuring and drafting of these innovative financial instruments.
The successful execution of this exchange offer and the final distribution of new bonds on February 27, 2025, brought the long-awaited debt restructuring process to its conclusion. This transaction adds to Clifford Chance's robust track record of advising on complex sovereign debt restructurings.
Legal Team Behind the Deal
Deborah Zandstra, the Clifford Chance partner leading the mandate, expressed her gratitude for the opportunity to work with Sri Lanka throughout the restructuring process.
“It has been a privilege to advise and support Sri Lanka over the past two and a half years. We are thankful for the trust placed in us and for the collaborative approach we shared with Sri Lankan authorities, the IMF country team, and the Paris Club Secretariat."
The core team working on the sovereign bond exchange offer included partners Jon Zonis and Deborah Zandstra, along with senior associates James Kelton and Sophie Wilkinson. Additional support was provided by partners Avrohom Gelber and associates Paula Ferreira, Agata Radajczyk, David Rondon, and Gil Shauly across Clifford Chance's global network.
Broader Debt Restructuring Efforts
Clifford Chance has also been instrumental in advising Sri Lanka on the broader debt restructuring process, including domestic debt restructuring and negotiations with official bilateral creditors such as the Export-Import Bank of China.
The firm has worked closely with the IMF and the Official Creditor Committee in the Paris Club to navigate complex negotiations with Sri Lanka's commercial creditors, including China Development Bank.
As the IMF Executive Board approved Sri Lanka’s Third Review of its IMF-Supported Program on February 28, 2025, Clifford Chance remains committed to advising Sri Lanka through the final stages of this debt restructuring process in 2025.
Clifford Chance's expertise in managing complex sovereign debt restructurings has been instrumental in Sri Lanka's financial recovery. The firm's leadership in guiding the bond exchange offer and broader debt negotiations was crucial to the successful execution of the deal, marking a significant milestone in Sri Lanka's efforts to restore debt sustainability. This successful restructuring, culminating in the final bond distribution, reinforces Clifford Chance's position as a global leader in financial advisory services.
Clifford Chance is a global law firm, established over 100 years ago, renowned for its expertise in banking, corporate law, finance, dispute resolution, and tax. With offices worldwide, it serves clients including corporations, financial institutions, governments, and not-for-profits. The firm delivers high-quality legal advice, combining global standards with local expertise, and strives to exceed client expectations by providing innovative solutions across all sectors.
