Another person familiar with the negotiations said Ukraine had recently indicated it is also willing to settle for a less severe haircut than it has previously put on the table to strike a deal

Ukraine, bondholders move closer to deal - WSJ

KYIV, July 31 /Ukrinform/. After months at an impasse over $19 billion in bonds, creditors agree to small haircut to speed debt restructuring

The Wall Street Journal reported with reference to people close to the negotiations.

Long drawn-out negotiations between Ukraine and the major investors who own its debt are finally starting to thaw.

After months of relative stalemate, a group of the conflict-torn country's creditors has indicated it is willing to take a small reduction in the face value of Ukrainian bonds to speed up a debt restructuring process, according to two people close to the negotiations.

Ukraine and its creditors have stood at an impasse for months over about $19 billion worth of bonds, which have tanked in value because of concerns the country wouldn't be able to meet repayments.

Ukraine has sought a restructuring of the bonds that would see investors take a haircut, or a reduction in the face value of their holdings. In June, Ukraine reiterated a proposed deal whereby bondholders would take a 40% haircut.

That proposal was initially met with short shrift from a committee of major bondholders, including the country's single largest creditor, Franklin Templeton Investments, who had steadfastly refused to accept a haircut. This week, however, the investor group, which holds about $8.9 billion of the bonds and is advised by Blackstone Group International Partners LLP, sent a new proposal to Ukraine's government that included agreeing to a haircut, two people close to the negotiations said.

A person close to the process said the committee made a conditional proposal subject to other terms and conditions.

Another person familiar with the negotiations said Ukraine had recently indicated it is also willing to settle for a less severe haircut than it has previously put on the table to strike a deal.