Dislocated Sovereign: Republic of Argentina
Summary of Transactions
k 1. ICSID/UNCITRAL: Gramercy is currently working on a solution with the Argentine government that would enable the resolution of
y ICSID/UNCITRAL liabilities in exchange for "zero cash" until 2014*. Similar to the fashion in which Gramercy orchestrated the 2010
exchange, Gramercy's proposal is a pre-packaged solution (i.e. guaranteed high participation).
2. Brady Bonds and Italian Task Force: Gramercy has created several possible solutions that would satisfactorily address liabilities for 'friendly'
bondholders and retail creditors holding untendered defaulted debt, thereby further isolating the 'holdouts'.
3. Paris Club: Argentina has proposed a reasonable solution to the Paris Club - full repayment of debt over a 5-year period (in contrast with an
80% haircut for Iraq and expected 50% haircut necessary for Greece). Once Argentina has normalized relations with the aforementioned
creditors, we believe the Paris Club proposal will be accepted fairly quickly.
4. Untendered bonds: Resolving the outstanding ICSID/UNCITRAL claims, Brady bonds and Italian Task Force liabilities will "clear the path" and
provide a powerful precedent for a final settlement with the most difficult creditors (i.e. 'holdouts'), as it will be increasingly difficult for
them to continue their current course of action.
Benefits Argentina May Experience By Resolving Outstanding Liabilities
• Capital markets access for the Republic of Argentina, its provinces and corporations.
• Reduction of risk-free rate.
• Foreign direct investment increases.
• Foreign exchange reserves accumulation.
• Preferential U.S. trade benefits.
• Continued access to multilateral loans.
• Ratings upgrades.
•Gramercy has proposed that Argentina settle its liabilities with new 2022 bonds with a full PIK coupon through December 31.2013
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