‘Vulture’ funds are once again looking closely at Argentina
Distressed-debt investors and so-called “vulture” funds are once again setting their eyes in Argentina’s sovereign bonds, some of which are already trading at about 40 cents on the dollar.
The buyers, with an appetite for risk and financial shoulders to wait for payout, are expecting the market to go lower and then swoop in at about 30 cents, if they haven’t bought already.
These interested parties have two different strategies, experts believe. One is to purchase bonds to wring value out of the country’s distressed assets now that they are cheaper. The other, similar to what happened after the country’s 2001 default, is to play hard on future renegotiations, rejecting any haircuts or restructurings on the table and suing for full payment.