Lebanon will appoint Cleary Gottlieb Steen & Hamilton LLP as legal adviser on its Eurobonds, a source close to the government said on Monday, as investors and ratings agencies expect the heavily indebted state to restructure its debt.
Officials are in the last phase of deciding on the firm that will separately be appointed financial adviser, the source said.
Lebanon is grappling with a choking financial crisis. A foreign currency liquidity crunch has forced banks to impose tight restrictions on access to hard currency and transfers abroad and the Lebanese pound has slumped.
One of Lebanon's most influential leaders, Parliament Speaker Nabih Berri, said last week that debt restructuring was the best solution for looming Eurobond maturities, which include a $1.2 billion Eurobond due on March 9.
The finance ministry said on Friday it had issued requests for proposals to 12 firms to provide it with financial advice on a potential debt restructuring.
It listed the firms as Lazard LAZ.N, Rothschild & Co ROTH.PA, Guggenheim Partners, Houlihan Lokey HLI.N, Citibank C.N JP Morgan JPM.N, PJT Partners PJT.N, Newstate Partners, Standard Chartered STAN.L, GSA Capital Partners, Deutsche Bank DBKGn.DE, and White Oak.
S&P last week lowered Lebanon's sovereign rating on the expected debt restructuring. Moody's also downgraded Lebanon, saying the rating reflected expectations that private creditors would likely incur substantial losses in any debt restructuring.
Fitch also said Lebanon's financing position points to debt restructuring.