Argentine bondholders offer deal to holdouts

A group of Argentine bondholders will offer creditors suing for the repayment of defaulted sovereigndebt

a private deal to get them to abandon their litigation, the state-run Télam news agency said.

The move is being driven by investment funds from the United States and Europe, largely from the Bondholder Exchange Group, Télam reported, citing unnamed sources.

They propose to exchange bonds on which payments have been frozen for other paper that Argentina normally honours, with better conditions than the country has already offered. The offer would be formalized next week.

The Bondholder Exchange Group, led by emerging markets investment

specialist fund Gramercy, has supported Argentina in its long court battle in the United States against holdout creditors seeking to recover full payment from the bonds that the country stopped honouring after its 2002 financial crisis and default.

The Economy Ministry could not immediately be reached for comment. No one was available to talk from Gramercy’s Greenwich, Connecticut, headquarters.

“The private debt

swap proposal,” Telam said, “consists of offering an exchange to the holdouts in which they drop their demand for 100 percent repayment.”

Two restructurings in 2005 and 2010 saw creditors holding around 93 percent of Argentina’s debt agree to swap their bonds in deals giving them 25 to 29 cents on the dollar.

Bondholders who did not participate in the swaps, led by hedge funds Elliott Management Corp’s NML Capital Ltd and Aurelius Capital Management LP, went to court in New York to seek full payment.

Herald with Reuters

http://buenosairesherald.com/article/144695/argentine-bondholders-offer-deal-to-holdouts