Fidelity Calls Bluff on Buenos Aires Bond Payment and Wins Big

Fidelity Investments scored a victory over the province of Buenos Aires by compelling officials there to make good on a $250 million payment they had threatened to withhold, Bloomberg News reported. The Boston-based fund manager rejected the province’s demands for a three-month delay for the payment originally due in January, even as officials said there was no way the cash-strapped province could make good on its obligations. Fidelity’s outsize stake means it was effectively able to block the proposal, and in the end the province agreed to pay. It was a surprise win for creditors and an embarrassing defeat for Buenos Aires Governor Axel Kicillof, who is reviled by investors for the antagonism he showed in debt negotiations years ago during his stint as the federal government’s economy minister. Read more

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