Bondholder group corrects ‘misstatements,’ remains committed to Argentina debt restructuring talks

By Rebecca Melvin

New York, May 26 – An ad hoc bondholder group representing $16.7 billion of Argentina’s international bonds issued a statement on Monday correcting “misstatements” regarding restructuring negotiations made by the group on Friday.

“The Republic of Argentina has invited certain representatives of the Exchange Bondholder Group to sign a non-disclosure agreement in contemplation of engaging in negotiations with the Ministry of Economy regarding Argentina's debt restructuring. It is understood that representatives of certain other creditor groups have also been asked to sign non-disclosure agreements for the same purpose,” the Ad Hoc Group of Argentina Exchange Bondholders said in its release.

Further, the release went on to state that the group’s position is “contrary to comments from unnamed sources in the Argentine media,” and that the exchange bondholder group remains committed to the comprehensive restructuring proposal it submitted to Argentina on May 15.

As previously reported, the group had said on Friday in response to a further extension of its exchange offer that it could not support the exchange offer and that Argentina had made “virtually no substantive engagement with its creditors” over the last month.

At that time, it said it believed the terms require individual main-street investors in mutual funds and exchange-traded funds, pension funds, insurance companies and other organizations that hold Argentine bonds to bear disproportionate losses that are neither justified nor necessary.

The group also said its May 15 restructuring proposal would provide the country with substantial front-loaded cash flow relief and be in line with the macro-fiscal trajectory outlined by the government.

Last Thursday Argentina announced that it was extending for the second time its initial exchange offer, and the media reported that Argentina will not be making the overdue interest payments on its bonds prior to the end of the grace period on Friday.

Argentina’s failure to pay this interest will result in defaults across various bond issuances.

Advised by White & Case LLP, the bondholder group includes18 investment institutions, including AllianceBernstein, Amundi Asset Management, Ashmore Investment Management Ltd. and Ashmore Investment Advisors Ltd., Autonomy Capital, BlackRock Financial Management, Inc. and its affiliates, BlueBay Asset Management LLP, Fidelity Management & Research Co., Invesco Advisers, Inc., T. Rowe Price Associates, Inc., Western Asset Management Company LLC, and Wellington Management Co. LLP.

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