solution in sight. For the first time in years seems an agreement in the dispute between Argentina and US hedge funds to old debt within reach .
the new government has the plaintive investors $ 6.5 billion (5.8 billion euros), as ordered by the competent new York district court mediator Daniel A. Pollack announced. He had met last week with senior officials from both sides and there were “enormous progress” has been made.
However, at first remained unclear how the main investors evaluate the offer. “We comment at this stage does not,” said a spokesman for the hedge fund Aurelius Capital. NML Capital of the empire of US billionaire Paul Singer, also a leading force in the process against Argentina, initially could not be reached for comment. In the offer, the creditor would have to cut back in the amount of about 25 percent to the original claims totaling more than nine billion dollars making.
The contentious bond debt are from the state bankruptcy of the end of 2001. The hedge funds and some other investors had the following debt restructuring deals Argentina – unlike 93 percent of creditors – knocked out and sued for full repayment. The US District Judge Thomas Griesa ruled in 2014 against Argentina and decreed that the country needs to settle the debt before it can continue to operate other government bonds. The case is heard in New York, because the papers were once issued under US law to make them more attractive to the financial markets.
The Argentine government under the then President Cristina Fernández de Kirchner had always refused to negotiate seriously with her as a “vulture” funds maligned. The Payment boycott the second largest economy in South America, however, was largely cut off from the international capital markets. The Since December incumbent government of the new Head of State Mauricio Macri showed willingness to compromise from the beginning. Now talks mediator Pollack already of a “historic breakthrough”.
But Macris government needs to bring what is anything but a sure-given the majorities his coalition a possible agreement with creditors in Parliament. First, the offer will now be sent to Parliament for discussion and voting. Macri summoned both houses of parliament to exceptional meetings. They should meet on 11 February to. Even Judge Griesa would have to agree. Argentina has the offer under the condition that it annuls the prohibition of debt service by other lenders.
Argentina was classified as technically insolvent after Griesas assessments of rating agencies, which the country’s creditworthiness was further battered. For called “holdouts” investors to NML and Aurelius, the current offer would be much better than what the rest of the creditors had obtained in the previous rescheduling of 2005 and of 2010. They had to write off more than 70 percent. Two of the six funds – investors Montreux partner and Dart Management – are said to have already accepted the new offer. On Tuesday, Argentina had already reached an agreement with a group of Italian creditors agreed on the repayment of over one billion dollars.
The state bankruptcy Argentina concerned a debt of around 100 billion dollars. She had consequences that high returns had promised by the bonds for many savers in Germany. The case had attracted by claims by investors against their bank manager sensation that had need responsible for negligent advice. However, most investors were received on the rescheduling deals and took massive losses. Argentina’s former government accused NML and Aurelius, having bought bonds at bargain prices that had been rapidly lost value because of the high risk of default.
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