Citgo stock sale to continue under Delaware court order

José Ignacio Hernández, a lawyer specializing in administrative and constitutional law, reported that the process of selling the shares of the company Citgo Petroleum will continue.

For its part, the Delaware Court in the United States indicated on social media that it denied the objections presented by Venezuela at the hearing on Friday, May 17, 2024.

The purpose of the presentation before the American court was to decide what to do with the PDVSA 2020 Bonds and the resolution that was taken might “impact the trial and the fate of Citgo,” according to a publication by Banca y Negocio.

Hernández recalled that in February 2024, the highest court in New York decided in favor of PDVSA, considering that the Venezuelan Constitution “does govern the bonds. The case has not yet been decided by the Court of Appeals.”

He explained that it will still take months, perhaps years, to make a decision on the PDVSA 2020 Bonds case. “Venezuela’s position is that the sale process cannot be used to pay the holders of those bonds, who have a lien on the majority of Citgo Holding’s shares,” he said.

He added that if the Delaware court were to allow the bonds to be taken into account, there was a risk of further reducing “the amount that would be distributed among creditors, whose debts total US$ 22 billion.”