Argentina bonds bounce on news of holdout deal
By Paul Kilby
NEW YORK, Feb 24 (IFR) - Argentina bonds were bouncing off intra-day lows on Wednesday following news that major holdout investors were nearing a US$5bn deal with the government.
Local law Bonar 2024s were up a point in early afternoon trading to hit 107.50-108.00, while New York law discounts had inched about half a point higher to be quoted at 118.75-119.25.
Matthew McGill, a lawyer representing lead holdouts Elliott Management and Aurelius Capital Management, was quoted as saying that an agreement on economic terms with Argentina had been reached.
While the court appointed mediator in the negotiations subsequently said such statements "violated confidentiality", the news was important as both hedge funds had so far been resistant to signing on to Argentina's latest proposal.
An increasing number of investors which had refused to participate in the 2005 and 2010 restructurings have accepted the government's offer in recent weeks.
A more conciliatory approach from Argentina's new finance team has won applause from investors, the US Treasury and Daniel Pollack, the court appointed mediator over the negotiations.
The country's bonds rallied on Monday after US judge Griesa signaled on Friday he would be willing to lift an injunction that prevents Argentina from servicing restructured debt like the discounts.
Griesa said such a move would serve public interest provided that Argentina repealed two laws concerning its debts and paid all creditors who agreed to settle by February 29. Continuación...