Argentina Reaches Deal With Hedge Funds Over Debt

magnify-dollarNYT – Argentina has agreed to pay $4.65 billion to four hedge funds on Monday in a deal that could put an end to a more than a decade of mudslinging and legal attacks.

The hedge funds, which include the billionaire Paul E. Singer’s NML Capital, are the last among of group of investors that declared legal war on Argentina in the United States 12 years ago. These holdouts, so named for their refusal to partake in Argentina’s two restructurings after it defaulted on $100 billion of debt in 2001, sought billions in bond repayments and eventually succeeded in preventing Argentina from paying any of its creditors.

“This is a giant step forward in this long-running litigation,” Daniel A. Pollack, the court-appointed mediator, said on Monday. But, he added, it is “not the final step.” The settlement will resolve 85 percent of the claims of the holdouts, Mr. Pollack said.

That ruling is based on two conditions: that Argentina repeal its domestic law, known as the “Lock law,” that prevents it from paying the holdouts and that it makes full payments to bondholders who settle with Argentina by Monday.

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Jay is Editor In Chief of The Agonist, veteran and technologist.

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