Special Master Pollack to meet with Argentina's and holdout lawyers next week
A United States court-appointed mediator said on Friday he would hold a meeting next week between lawyers for Argentina and 'holdout' creditors suing the country in a longstanding dispute over defaulted debt.
Daniel Pollack, the New York lawyer appointed to oversee settlement talks, or Special Master, confirmed that he anticipated a meeting, declining to provide further details.
The meeting is expected to focus on how settlement talks should proceed in January after the expiration of a bond clause that the Argentine government has cited as a major stumbling block in cutting a deal, a person familiar with the matter said.
Argentina contends the so-called Rights Under First Offer, or RUFO, clause prohibits it from voluntarily paying the holdouts suing for full payment. The clause expires Dec. 31.
Argentina was declared in 'technical default' in July for the second time in 12 years after refusing to pay 1.33 billion dollars plus interest to bondholders, a group of hedge funds, suing for full payment on defaulted bonds.
The hedge funds, led by NML and Aurelius Capital Management, had spurned Argentina's 2005 and 2010 debt restructurings, which resulted in exchanges for about 92% of the country's defaulted debt.
US Judge Thomas Griesa last month held Argentina in contempt of court, calling “illegal” the country's plans to get around his rulings by making payments locally. This was implemented by the Argentine congress approving the Sovereign Payment law which allows to pay restructured bondholders in Argentina or France, through an Argentine bank.
Argentine Economy Minister Axel Kicillof who is currently in the US for the IMF and World Bank annual assemblies, assured on Friday that the country will keep on looking for a solution to the holdout funds' dispute and will encourage dialogue to reach a deal.
”The government will use up all the judicial, diplomatic, international ways, because we understand this is not a problem between Argentina and Paul Singer (head of NML Capital),” he said.
Judge Thomas Griesa's ruling put the case on an international status, the minister told reporters in Washington.
Holdouts are expected to request Judge Griesa to declare in contempt of court the Argentine Banco Nacion and Central bank as instruments of the Sovereign payment bill. This is because both banks helped Argentina in its efforts to skirt Griesa's ruling pari passu ruling regarding payment of the holdouts.
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