Bond Buyers Won't Copy Argentina Holdouts, S&P Says
Law360, New York (November 26, 2014, 3:26 PM EST) -- Argentina’s apparent defeat in an epic sovereign-debt dispute with a small group of U.S. hedge funds won’t encourage bondholders in future sovereign restructurings to litigate for full repayment instead of accepting negotiated haircuts, a ratings agency said Wednesday.
In a research note, Standard & Poor’s Ratings Services argued that sovereign-debt investors are unlikely to follow the well-publicized “holdout” strategy of hedge funds including Paul Singer’s Elliott Capital Management that refused to accept haircuts following Argentina’s 2001 default.
The hedge funds won court rulings compelling Argentina to satisfy their debts on equal footing with its restructured bonds, something the cash-strapped nation has...
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