Suriname offered late Monday to exchange $675 million of dollar bonds for new notes, the next step in negotiations after reaching a deal with its bondholders in May.
The government offered holders of debt due in 2023 and 2026 to swap their notes for a new 10-year bond due July 15, 2033, with an annual interest rate of 7.95%.
Suriname will also issue notes with payouts linked to the government securing at least $100 million in oil royalties from an offshore reserve known as Block 58, so-called value recovery instruments (VRI).
Once the $100 million is reached, Suriname will allocate 30% of its annual royalty income from Block 58 to make payments on a quarterly basis until the notes mature in 2050, it said.
The offer expires at 5:00 p.m. New York time on Nov. 3, 2023, the government said.
Early on Tuesday, the committee of debt holders including Franklin Templeton, Eaton Vance, GMO, Greylock Capital and T. Rowe Price issued a statement in support of the offering.
In September, the International Monetary Fund (IMF) board cleared the third review of its program of more than $600 million for Suriname, granting the government's request for a waiver of non-compliance based on measures already taken.
Suriname is also reworking its debt with bilateral creditors, and said this month its foreign minister would visit Beijing in early November for talks, following China's counter-response to an earlier proposal.
(Reuters - Reporting by Nilutpal Timsina in Bengaluru; Additional reporting by Rodrigo Campos in New York; Editing by Clarence Fernandez and Richard Chang)