Bonar 2024s slip as Argentina tries local sale
By Paul Kilby
NEW YORK, April 21 (IFR) - Argentina's Bonar 8.75% 2024s slipped close to a point Tuesday morning as the government announced a local sale of the bond to try to get round US restrictions on its market access.
The up to US$500m sale - which starts today through a local auction without banks - is the sovereign's latest attempt to regain a foothold in the capital markets.
"This will be a test on whether this is a market Argentina can issue in and whether there is any legal backlash," said Siobhan Morden, head of Latin America strategy at Jefferies.
The Bonar 2024s extended recent losses after the announcement, sinking to around 105.00 in anticipation of more supply - more than two points down since the 107.85 level seen last week.
Argentina was forced to shelve a US$2bn-plus sale of the Bonar 2024s in March when bookrunners Deutsche Bank and JP Morgan backed away from the deal.
They retreated after a US judge ordered them to produce documents and witnesses on the deal, in yet another standoff between the sovereign and US Judge Thomas Griesa.
An injunction from Griesa last year effectively stopped Argentina from making payments on nearly US$30bn in restructured debt unless it made holdout investors whole as well.
The US dollar-denominated Bonar 2024s, however, were seen as outside the reach of US courts, as they were not part of the 2005 and 2010 restructurings contested by holdout creditors. Continuación...