Ukraine’s Finance Ministry will make a $120 million Eurobond coupon payment on Friday as debt-restructuring talks with creditors are set to continue, a person familiar with the negotiations said.
Lazard Ltd., which is representing Ukraine, and Blackstone Group LP on behalf of the creditor committee, are in intensified communication, according to another person with knowledge of the situation. The state-run Ukrinform news service said earlier Thursday that Ukraine intends to make the payment.
“Payment means the debt-restructuring talks are going well,” Sergey Fursa, a Kiev-based bond trader at investment bank Dragon Capital, said by phone. “There was no legal way for the government not to pay this coupon.”
Ukraine -- grappling with a war, this year’s worst-performing currency and a second year of recession -- has threatened to halt bond payments if there’s no progress on its $19 billion restructuring. The government says a cut in principal payments is needed to restart economic growth, while a group of creditors led by Franklin Templeton argues that a writedown isn’t needed.
The Ukrainian government’s dollar-denominated bonds due 2017 were little changed at 54.84 cents on the dollar as of 6:52 p.m. in Kiev, data compiled by Bloomberg showed.