Investors Eye $60B Venezuela Debt Deal After Maduro's Exit

A group of major global investors has announced it is ready to begin talks on restructuring $60 billion in defaulted Venezuelan bonds, marking a critical first step in what could become one of the world's most complex sovereign debt workouts.

The Venezuela Creditor Committee, which includes heavyweights like Fidelity Management & Research, Morgan Stanley Investment Management, and Greylock Capital Management, said it is prepared to start negotiations as soon as it receives authorization. In a statement Friday, the group argued that a successful restructuring would "accelerate financing across all sectors of the Venezuelan economy."

Political Shift Sparks Market Rally

This move follows a dramatic shift in Venezuela's political landscape after a U.S. military operation removed President Nicolas Maduro from power. Acting leader Delcy Rodriguez has signaled a new willingness to cooperate with the Trump administration to boost oil production and stabilize the nation's battered economy.

These developments have triggered a rally in Venezuelan bonds, which have been in default since 2017. Government notes due in 2027 surged more than 10 cents this week, their largest weekly gain since 2023. Debt issued by the state-owned oil company, Petroleos de Venezuela SA (PDVSA), has also climbed.

The Path to Restructuring: Hurdles Remain

While bondholders are optimistic that negotiations could begin this year, the timeline depends heavily on politics. Venezuela remains under U.S. economic sanctions that block its access to international capital markets—a crucial element for any restructuring deal.

Furthermore, critical questions loom over the future of Venezuela's oil industry. The revenue generated from oil will be a determining factor in the country's ability to repay its massive debts. When factoring in past-due interest, loans, and other obligations, Venezuela's total debt is estimated to be as high as $170 billion, positioning it as one of the largest government debt restructurings in decades.

Unpacking the Proposed Debt Strategy

According to sources familiar with the matter, the creditor committee met on Monday to discuss the recent events in Venezuela. Some members reportedly agreed that Maduro's removal has accelerated the potential timeline for a debt resolution.

One proposal being considered by the committee involves combining Venezuela's sovereign debt and PDVSA's debt into a single, unified restructuring. Proponents believe this would give the country a single pricing baseline for its debt and make the entire process easier for all parties to understand.

Who Are the Key Players at the Table?

The creditor committee was formed approximately eight years ago, after the first round of U.S. sanctions pushed Venezuela toward default on its financial obligations.

The group is legally represented by Thomas Laryea of Orrick, Herrington & Sutcliffe LLP. Its membership also includes:

• Grantham Mayo Van Otterloo & Co., LLC

• Fidera

• HBK Capital Management

• Mangart Capital

• T. Rowe Price Associates, Inc.

• VR Advisory Services Ltd.

The committee's recent statement did not disclose the total amount of Venezuelan debt held by its members.