UPDATE 2-Argentina announces two-part US dollar bond: source

jueves 30 de junio de 2016 14:20 GYT

(UPDATES throughout)

By Paul Kilby

NEW YORK, June 30 (IFR) - The Republic of Argentina announced a two-part US dollar bond sale on Thursday, just three months after its historic return to the international capital markets.

The country is looking to raise funds to take out expensive GDP warrants, but the timing has caused a bit of a stir after it said it would hold off from further issuance in 2016.

Argentina was locked out of the markets for a decade and a half due to default, but sold US$16.5bn across three, five, 10 and 30-year tranches in April - while saying it was done for the year.

"It is a big deal because credibility matters," said Sean Newman, senior portfolio manager at Invesco. "This is under the guise of a liability management transaction, and there is not a lot of transparency."

Proceeds from the deal, which is expected to be US$2.5bn-$3bn in size, are slated to fund the buyback of GDP warrants - a transaction that the finance ministry says could save the country some US$9.4bn.

"It is a noble idea in the sense you are not issuing net new debt, but it contradicts their very bold statements about not placing new paper in the market," said Alejo Czerwonko, emerging markets economist in the chief investment office at UBS Wealth Management.

"That may not resonate too positively with the investment community."   Continuación...