(Adds source comment in last paragraph)
NEW YORK, June 21 (Reuters) – Suriname said on Monday the termination trigger notice sent by its creditors is not compliant with the bond’s terms, making it “ineffective.”
“In the absence of evidence that the delivered notices are compliant with the terms of the contractual documentation governing the Notes, the Ministry of Finance has concluded that the delivered notices are ineffective and the Termination Trigger with respect to the Notes has not been exercised,” the government said in a statement.
Last week, a majority of creditors said they were reinstating payment obligations that had been deferred under a proposal launched by Suriname in March. The government replied creditors were taking a “confrontational attitude” toward debt restructuring talks.
Creditors said the 70% haircut proposed by Suriname to commercial holders of the outstanding $675 million in 2023 and 2026 notes does not take into account its own rosy description of its economic future.
Holders have also complained about not being sufficiently involved in Suriname’s negotiations with the International Monetary Fund for a $690 million financing deal.
Suriname’s bond prices were little changed on Monday but have fallen sharply since the government haircut proposal early this month.
“Bondholders granted the standstill under the Consent Solicitation (and) have the right to terminate if they feel the commitments agreed under the CS have not been fulfilled,” said a source close to the situation. (Reporting by Rodrigo Campos; editing by Jonathan Oatis and David Gregorio)