Banks pin hopes on Argentina bond surge

viernes 4 de marzo de 2016 11:23 GYT

By Paul Kilby

NEW YORK, March 4 (IFR) - Bankers struggling to make a living in a waning Latin American primary market are counting on a surge of bond issuance from Argentina after the country cut a historic deal with principal holdouts this week.

Argentina has turned into the new stomping ground for DCM bankers scouring the region for business as the country emerges from a near 15-year isolation brought on by its 2001 default.

This week's agreement between the South American country and Elliott Management - a key driver behind Argentina's legal battle with so-called holdout investors - effectively marks an end to the bitter debt dispute and paves the way for the sovereign's first bond in 15 years.

Barring any objections from Congress, the republic is now likely to issue up to US$15bn of bonds starting as soon as April in an effort to pay litigant investors.

A deal this size would make it the largest bond offering ever from an emerging markets borrower, putting it ahead Brazilian oil firm Petrobras' US$11bn in 2013, according to Thomson Reuters data.

More Argentina supply is likely to follow as the government seeks tens of billions of dollars to plug the country's growing fiscal gap.

A string of provinces are also preparing international bond sales led by Buenos Aires, which has already kicked off European and US roadshows through Citigroup, HSBC and JP Morgan.

Also lining up are corporates such as real-estate firm IRSA, oil company YPF and perhaps utility Pampa Energia, as it seeks to fund the acquisition of a stake in Petrobras Brazil.   Continuación...