Mensajepor pablo9494 » Lun Oct 25, 2010 10:07 pm
Lo mismo de siempre....
US fund moves to recover Argentina debt
By Jude Webber in Buenos Aires
Published: October 25 2010 20:58 | Last updated: October 25 2010 20:58
One of the funds that spurned Argentina’s debt swap this year and is still suing to recover assets from the country’s default on almost $100bn in 2001 has unveiled what it believes is a new strategy to compel the government to pay up.
NML Capital, a private investment firm affiliated to Elliott Investment Corporation that bought debt prior to the default and is owed $2bn, has filed a legal motion in New York requesting equal treatment with other bondholders – which would mean Argentina must pay NML if it also pays others.
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Analysis: State of bankruptcy - Aug-01Argentina ‘delighted’ over debt swap success - Jun-23Low demand for Argentina’s debt swap - May-20Italians voice Argentina debt unease - May-13NY judge freezes Argentine assets held by Fed - Jan-13Argentina debt battle intensifies - Jan-10NML says that under fiscal agency agreements dating from 1994 its bonds cannot be ranked differently to other paper and thus must be paid on an equal footing.
It says that means any payments made to holders of paper issued in the 2010 debt swap and an earlier swap in 2005 – which Argentina believes together have put its default status behind it – cannot be made without also paying NML. That would mean any interest payment on bonds issued in the swaps would have to be made on a pro-rata basis with NML’s debt also included in the payment schedule.
Under the motion, filed last week with the US District Court of New York, NML Capital is seeking for Argentina “at last, and on penalty of contempt (of court) to pay NML – as it is abundantly capable of doing – on a par with the creditors it is certain to pay”.
It said to do otherwise would be to “maintain an unlawful preferential payment scheme”.
Elliott, which has hired Theodore Olsen, a former US solicitor-general, to press its case, hopes New York judge Thomas Griesa could rule on the case in the first quarter of next year.
Via its tough 2005 and 2010 swaps in which Argentina forced creditors to accept a 75 per cent “haircut” or writedown, the government has settled with the holders of more than 92.4 per cent of the debt on which the country defaulted in 2001. It says the few so-called “holdouts”, which spurned the swaps and are still pressing for a better deal, are vulture funds acting in bad faith.
The government believes their continued litigation will not prevent it from raising money on capital markets from which it has been shut out for a decade for fear that funds issued cound be seized by the courts to pay creditors. No one at the economy ministry was immediately available to comment on the NML filing.
However, Argentina has made clear it has no plans to negotiate with funds which refused to take part in the swap. NML, meanwhile, says Argentina had gone to “extraordinary and unique lengths to avoid its legal obligations by moving assets in order to evade enforcement”, and has made clear it will continue to seek to embargo Argentine assets abroad to recover its investments.
The government had considered issuing $1bn in tandem with the swap in June but preferred in the end to wait for better market conditions, which it hopes will allow it to clinch a rate of below 9 per cent. It has not yet said when it might seek to return to capital markets.
Elliott believes that the equal treatment litigation will keep it out of capital markets and one person familiar with the group’s thinking said the default “probably costs them a couple of hundred basis points a year”.
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