Investment bank Lazard has made a late bid to take over from Centerview Partners as Venezuela’s financial adviser in the nation’s sweeping sovereign debt restructuring, offering to perform the advisory role for a significantly lower fee, according to a news report.
The proposal sent on Friday to interim President Delcy Rodriguez put Lazard’s fee at $25 million, a fraction of the minimum $150 million Centerview was reportedly seeking as recently as last month. Reuters was not able to independently verify the report, and Lazard, Centerview and Venezuela’s Ministry of Communication and Information did not immediately provide comment.
Background of the advisory engagement
Caracas announced in May that it had hired Centerview, a U.S.-headquartered financial services firm, after initiating a restructuring process for both the sovereign’s debt and that of state oil company PDVSA — a move that supported bond prices.
According to the report, Centerview had discussed a compensation package that included a monthly retainer of $750,000 and a success fee equal to 0.1% of the total restructured debt. That success-fee formula would translate into overall compensation in the range of $150 million to $200 million, based on draft contract figures cited in the report.
Scope and stakes of the restructuring
Venezuela ranks among the largest sovereign default situations globally. The sovereign and PDVSA together have about $60 billion in defaulted bonds outstanding. Analysts cited in the report estimate that when arbitration awards and accrued interest are included, total liabilities could exceed $150 billion.
The adviser chosen by Caracas will be responsible for shaping the government’s financial strategy and leading debt negotiations. The size of any creditor writedown will be central to determining the public finances’ sustainability and, by extension, Venezuela’s economic outlook.
Concerns over the selection process
Earlier reporting highlighted that Centerview’s appointment occurred without a formal competitive process, prompting questions among investors and officials about the fairness and transparency of the selection. The late Lazard bid, if confirmed, would represent a contest to that appointment primarily on price.
At this stage, details remain limited to the reported fee proposals and the basic terms discussed in the draft contract. Further confirmations or official statements from the parties involved have not been provided.