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Wednesday, November 28, 2012

US Appeals Court grants emergency halt on Argentine bond payment

A US appeals court yesterday granted an emergency stay order that gives Argentina more time to argue against making a $1.33 billion payment to investors who rejected two debt restructurings in the nation's 2002 sovereign debt default.

The federal appeals court postponed judge Thomas Griesa's ruling "pending further order" and set February 27th as the day in which Argentina will be able to present its case against the judge's orders.

The measure lets the Argentine government face a bond payment of $3.3 billion dollars without any risk to holders of its restructured debt.

The appeals court has put off any decision until well into 2013 on whether or not Argentina will have to pay so-called holdout investors who did not participate in the 2005 and 2010 debt restructurings which paid less than 30 cents on the dollar.

Both Argentina and bondholders who took part in the exchange filed appeals to the 2nd Circuit. Oral arguments before the court will occur on Feb. 27.

Yesterday's decision by the 2nd Circuit effectively halts the order by US District Court Judge Thomas Griesa in Manhattan that could have led to a technical default on approximately $24 billion worth of debt issued in the 2005 and 2010 exchanges.

Lead holdout investors Elliott Management Corp and Aurelius Capital Management both declined to comment on the 2nd Circuit's decision.

Yesterday, the Government had stated that it would wait for the US court's decision to evaluate Griesa's ruling.

Earlier, Economy Minister Hernán Lorenzino, assured that the decision to reopen the defaulted-bond payment or not is tied to the federal appeals court decision on the case filed by the vulture funds against the country.

"We're waiting for the appeals court decision. We have nothing to add to the case until they reach a decision on the matter," he added in a press conference.

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Tags:  argentina  us  appeals court  bondholders  





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Edition No. 5055 - This publication is a property of NEFIR S.A. -RNPI Nº 5343955 - Issn 1852 - 9224 - Te. 4349-1500 - San Juan 141 , (C1063ACY) CABA - Director Perdiodístico: Ricardo Daloia