Argentina

Argentina is poised to return to international capital markets after a 15-year ban as it finally reached an agreement with a group of creditors led by Paul Singer’s Elliott Management, the Financial Times reported. The deal, which has to be approved by Argentine lawmakers, is to pay $4.653bn to settle all claims with four “holdouts” that had refused to restructure debt after the country’s 2001 default.

After winning a victory in its decade-long battle with a group of US hedge funds in a New York court, attention now switches to Argentina’s congress. Judge Thomas Griesa said on Friday that he would lift a controversial financial blockade preventing Argentina’s access to the international capital markets, the Financial Times reported.

After more than a decade of legal warfare, Argentina could be on the cusp of peace with its creditors. However, even if Buenos Aires does reach an accord with Elliott, experts fear the saga will leave a toxic legacy for the wider sovereign debt restructuring world that could linger for years to come, the Financial Times reported. “In many ways this stopped being about Argentina a long time ago,” says Anna Gelpern, a law professor at Georgetown University.

Over the past few days, the talk among those who watch "the most miserable country" in the world has turned to default, Business Insider reported. This year, it seems, is Venezuela's year. "Unless the Chinese pull something out of the bag or PDVSA [Venezuela's state oil company] exercises a voluntary bond swap it's happening," said Brian Dean, a partner at ACG Analytics. "There's going to be a default in my view unless there's some kind of political disruption ... They can sell assets but I don't know what they have left." The "default" calls have gotten especially loud over the last week.

Argentina has offered to pay $6.5 billion to a group of hedge funds holding bonds it defaulted on 14 years ago in a historic effort by the nation to put a bitter legal battle behind it, the International New York Times DealBook blog reported. Montreux Partners and Dart Management, two of the hedge funds, have accepted the proposal, which would pay three-quarters of a $9 billion claim on defaulted bonds, according to emailed statements from Daniel A. Pollack, a court-appointed arbiter, and Argentina’s finance ministry.

Argentina made its first agreement with a group of “holdout” creditors that rejected debt restructurings after the 2001 default on Tuesday, moving a step closer to regaining unfettered access to international capital markets, the Financial Times reported. The new government of President Mauricio Macri, who has vowed to normalise relations with the rest of the world, will pay a group of Italian bondholders $1.35bn in cash. That represents 150 per cent of the value of the $900m in bonds that Argentina defaulted on 15 years ago.

Holdout creditors are demanding information from HSBC Holdings Plc about Argentina’s effort to raise cash, as the government seeks to end a 14-year standoff that has kept the nation out of international credit markets, Bloomberg News reported yesterday. The creditors last week served HSBC with a subpoena for documents on the bank’s involvement in the country’s attempt to raise money abroad.

Argentina's new government is shopping around for a second law firm to help resolve the country's longstanding battle with creditors suing it over its unpaid debt, Reuters reported yesterday. The center-right government of Mauricio Macri will publicly launch its search otoday for a new firm based in New York City to work together with Cleary Gottlieb Steen & Hamilton LLP. Argentina and the so-called "holdout" bondholders plan to meet in the second week of January to start talks toward settling the legal dispute that stems from the country's $100 billion default in 2002.

Mauricio Macri clinched Argentina’s presidency last month by tapping into voters’ fatigue with a leftist political movement that had governed for more than 12 years, the New York Times reported today. But just three weeks into his four-year term, Macri’s sweeping economic changes are roiling Argentina, accentuating the divide he wanted to bridge. Macri’s government devalued the peso by nearly 30 percent in mid-December, to more than 13 pesos to the dollar from 9.8; it later strengthened slightly.

A U.S. court-appointed mediator said that Argentina's new government and holdout bondholders are to meet in the second week of January to start "substantive" talks toward settling a more than decade-old sovereign debt dispute, Reuters reported yesterday. The talks would mark a major breakthrough in the dispute, which has caused Argentina to be shut out of the international capital markets and encouraged the prior governments of both Cristina Fernandez and Nestor Kirchner to adopt unorthodox economic policies.