Appeals Court opens way for Argentina to end battle with hedge funds. [View all]

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The United States Court of Appeals paved the way on Wednesday for Argentina to raise billions of dollars to pay a group of hedge funds, bringing it one step closer to re-entering international markets for the first time in 15 years.

In a ruling from the bench, three judges on the court of appeals in New York upheld a ruling by Judge Thomas P. Griesa of the U.S. District Court in Manhattan to lift an injunction that has barred Argentina from paying most of its foreign bondholders since 2014. In March, the United States government weighed in on the battle, lending its support to Argentina in a “friend of the court” or amicus curiae brief.

The ruling caps years of bitter legal wrangling that goes back to 2001, when Argentina defaulted on nearly $100 billion of bonds. Over 92% of bondholders accepted two debt restructurings by Argentina in 2005 and 2010; but a small group of holdout investors refused to take part. Hedge fund billionaire Paul Singer, the principal litigant, bought defaulted Argentine bonds at a steep discount in 2008.

Argentina agreed on February 29 to pay $4.65 billion to four hedge funds including Singer’s Cayman Islands-based NML Capital, which would receive around half of that. As part of the deal, Argentina’s Congress had to repeal domestic laws that prevented the government from paying the holdouts, which it has now done. Argentina was also required to pay the investors by April 14, after which the hedge funds could walk away from the deal.

Argentina asked that Judge Griesa’s original injunction be lifted after it made an offer to pay $6.5 billion to settle lawsuits from other holdout bondholders on Feb. 5, which the Appeals Court today did. There are still some disgruntled bondholders who were not part of the $4.65 billion deal with the four hedge funds. They have argued that they will receive far worse terms if they agree to Argentina’s $6.5 billion proposal.

Argentina is now poised to raise more than $12 billion through bond sales, the proceeds of which will pay its holdout cbondholders. Top officials from Argentina will travel to New York and other American cities this week to meet with potential investors.

“This is going to be settled next week,” Alfonso Prat-Gay, Argentina’s economy minister, told journalists in New York, where he is pitching Argentina’s multi billion-dollar bond sale to investors, according to news media reports in Argentina. Prat-Gay, according to the reports, said Argentina would issue the bonds on Monday and Tuesday and that the holdout creditors would receive payment by Friday.

At: http://www.nytimes.com/2016/04/14/business/dealbook/court-opens-way-for-argentina-to-end-battle-with-hedge-funds.html?_r=0
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Singer no doubt had a word with these judges to make sure they don't get in the way of his 1,180% return. If only some of that could at least go toward reimbursing taxpayers for the $7 billion in TARP money he extorted from the U.S. Government in 2008.