Documents reveal details of administration’s ‘vulture’ offer NEW YORK — Argentina agreed to pay two creditors more than US$1.1 billion to resolve claims over defaulted debt, as part of the country’s efforts to resolve long-running litigation over its 2002 default, court papers filed yesterday showed. Settlement agreements filed in federal court in Manhattan disclosed that billionaire investor Kenneth Dart’s EM would receive US$849.2 million, after agreeing to participate in Argentina’s proposal to resolve the litigation for US$6.5 billion.

Dart’s EM to receive US$849.2 million while montreux will be paid nearly US$300 million

Thursday, February 18, 2016

Documents reveal details of administration’s ‘vulture’ offer

NEW YORK — Argentina agreed to pay two creditors more than US$1.1 billion to resolve claims over defaulted debt, as part of the country’s efforts to resolve long-running litigation over its 2002 default, court papers filed yesterday showed.

Settlement agreements filed in federal court in Manhattan disclosed that billionaire investor Kenneth Dart’s EM would receive US$849.2 million, after agreeing to participate in Argentina’s proposal to resolve the litigation for US$6.5 billion.

“The parties agree to cooperate with each other in all aspects to accomplish this settlement,” an agreement signed by EM’s lawyer Ken Johns and Finance Secretary Luis Caputo reads.

Montreux Partners LP, which along with EM Ltd was among six leading bondholders at the centre of efforts by Argentina to settle the legal battle, will be paid nearly US$298.7 million, court papers said.

“Upon full receipt of such funds, Montreux shall provide Argentina with a full and final release and discharge and a stipulation of dismissal with prejudice of the judgments previously entered against Argentina,” an agreement signed by Caputo and Montreux’s lawyer Michael Straus reads.

The papers marked first disclosure of how much each creditor would be paid. Daniel Pollack, a court-appointed mediator, had previously said the two agreements were for “well over $1 billion” without disclosing the breakdown.

Their agreements were first announced on February 5 as Argentina proposed paying US$6.5 billion to settle litigation stemming from its record default on almost US$100 billion in 2002.

The offer represents a 27.5 percent to 30 percent discount for creditors who filed claims of about US$9 billion. The settlements are conditioned on the approval of the Argentine Congress — which has to lift the Padlock Law and the Sovereign Payment Law — and the lifting of injunctions in the litigation by US courts.

While the offer was accepted by EM and Montreux, four other leading creditors including Elliott Management’s NML Capital and Aurelius Capital Management have not accepted the offer yet. NML hasn’t made any comments over Argentina’s offer yet, while Aurelius has criticized the offer.

Both funds have until tomorrow to explain to United States Judge Thomas Griesa why he shouldn’t lift the injunction against Argentina, which filed a request to Griesa last week in order to move forward with debt talks.

Herald with Reuters