Argentina has launched the sale of debt maturing in 100 years’ time.
Coming just two years after the country ended currency controls, a successful sale will mark the latest step in a swift market rehabilitation for a nation which spent more than a decade fighting investors who held out against its most recent default, in 2001.
Initial pricing thoughts for the dollar-denominated bond deal launched early in the New York trading day are for an annual yield of 8.25 per cent, according indications given to prospective investors, which would be around 2 percentage points higher than existing Argentina debt maturing in 2046.
A global investor conference call with Nicolas Dujovne and Luis Caputo, co-heads of the reorganised finance ministry, was scheduled for 9am. The deal was expected to price on Monday, and the banks leading the transaction are Citi, HSBC, Nomura and Santander.
Paul McNamara, a macro investor for Gam, said :”100 years, really? That implies a major change in the [country's] political culture”.
Argentina has defaulted on sovereign debt eight times since its 1816 independence, most recently the 2001 default on $100bn of sovereign bonds, which at the time was the world’s largest default.
However, the country completed an extensive investor roadshow earlier in April, ahead of a successful return to the world’s capital markets, meaning potential investors are familiar with the prospects of the country under President Mauricio Macri, who has appointed market friendly officials and cut a deal with holdout creditors.
Image via AFP