Argentina delays formal bond revamp offer until ‘early’ next week: source

Argentina will extend the deadline for its proposed bond restructuring beyond Aug. 24 and plans to submit its amended offer to U.S. securities regulators next week, a source with direct knowledge of the situation told Reuters. People are pictured outside a bank in Buenos Aires' financial district, Argentina October 18, 2018. Picture taken October 18, 2018. REUTERS/Marcos BrindicciBondholders will have 10 days to decide on the offer once it is submitted. The previous deadline for accepting the deal was Aug. 24. That schedule implied the government would issue a decree formalizing the offer and file with the U.S. Securities and Exchange Commission on Friday. “The decree will not be finalized today, but early next week,” said the source, who is familiar with the government’s thinking and asked not to be named as the process is confidential. Monday is an official holiday in Argentina. “The next working day is Tuesday. The 10-day period will be met and in no case will the extension of the offer period go beyond August,” the source said, adding that last-minute “mechanical work” remained to be done on the decree before the offer can be presented to the SEC. An economy ministry spokesman declined to comment. Argentina and its main creditor groups reached an agreement in principle on Aug. 4 to restructure about $65 billion in distressed sovereign bonds. With the economy expected to shrink 12.5% this year, the government wants to avoid the kind of messy default that punctuated a crisis in 2001 that sent millions of middle class Argentines into poverty. The country’s main population centers are on lockdown amid the novel coronavirus pandemic, further complicating the economic outlook. The virus has claimed 5,428 lives in the country so far. After the upcoming bond revamp is done, Argentina will start talks with the International Monetary Fund toward a new program to replace a defunct $57 billion standby lending deal that was negotiated by the previous administration.

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