Cleary Gottlieb and Lazard
legal and finance advisors
newly appointed government consultants
The government has appointed two US-based firms to act as legal and financial advisers on public debt restructuring.
Cleary Gottlieb Steen & Hamilton LLP will act at its legal adviser. Asset management company Lazard will act as the government’s financial adviser.
According to Bloomberg, Cleary Gottlieb Steen & Hamilton has frequently worked alongside Lazard.
Cleary Gottlieb Steen & Hamilton LLP, known as Cleary Gottlieb, is an international law firm headquartered in New York. It was founded in 1946. The firm currently has offices in 15 cities. “When nations can’t pay their creditors, the phones start ringing at Cleary Gottlieb Steen & Hamilton,” according to a Reuters story in 2012. “Rare is the finance minister of a developing country who does not have Cleary Gottlieb Steen & Hamilton on speed-dial. Cleary has long been the go-to law firm for governments in debt crises,” according to an article published by the Economist in 2014. At that time, the firm had advised 28 sovereign debtors in 54 restructurings. Its clients include Russia, Greece, Iraq, Puerto Rico, and South Korea. It has advised Argentina in 2014 to default on its bonds, in order to force a renegotiation of the debt. For a decade, Cleary Gottlieb had helped Argentina fend off nearly all payment demands from a group of bond investors who refused to go along with the country’s steeply discounted debt restructurings. It had also advised Ecuador in 2009, and was subsequently fired by its government.
Lazard (formerly known as Lazard Frères & Co.) is the world’s largest independent investment bank serving primarily institutional clients. Its main executive offices are in New York City, Paris, and London. It was founded in 1848 and operates from 43 cities across 27 countries. The Managing Director of its Paris office, and Partner, is Francois Kayat, of Lebanese origin. Hamouda Chekir, is the director of the Government Advisory Group at the firm. Lazard has advised a number of countries including Greece (where it was eventually replaced by Rothschild), Argentina, Egypt, Iraq, Ukraine, and a number of African countries. According to Reuters: “Argentina was the first in a long series of government jobs that restored Lazard’s position as the go-to shop. It helped steer the country through lengthy negotiations at the Paris Club of sovereign creditors based at the French Treasury.” In 2015, the firm’s CEO of its French subsidiary (resigned a few months ago) Matthieu Pigasse said: “We have always, consistently, been on the governments’ side,” saying that, unlike others, his firm has categorically refused jobs to advise creditors on the other side of the fence. In 2012, Lazard persuaded most of the owners of the €206 billion of Greek debt to accept a 75 percent haircut on the value of their holdings. Lazard charged the Greek government 0.015 percent of the face amount of the bonds swapped, earning up to €25 million.
Date Posted: Feb 26, 2020