Exchange Bondholder Group Rejects Argentina's Unilateral Exchange Offer; Stands Ready to Engage in Good Faith Process

NEW YORK and BUENOS AIRES, Argentina, April 20, 2020 /PRNewswire/ -- Over the last several weeks, members of the Ad Hoc Group of Argentina Exchange Bondholders (the "Exchange Bondholder Group") have engaged in discussions with the Republic of Argentina's representatives with the objective of achieving realistic solutions to Argentina's debt service challenges.  The Exchange Bondholder Group currently holds, collectively, more than $4 billion principal amount, or over 16%, of all bonds issued by Argentina under its 2005 indenture and 2010 indenture supplement.  These bonds represent the interests of thousands of institutional investors and individuals on whose behalf Exchange Bondholder Group members invest.

The Group is, and has always been ready, to engage constructively to achieve a resolution in which all parties would contribute in an equitable manner to achieve a sustainable debt burden supported by appropriate policies.  Such a resolution would place Argentina on a solid path of economic growth, preserve market access for the Republic and Argentine issuers and, most importantly, raise living standards for the people. 

The Exchange Bondholder Group entered into these discussions in good faith with an understanding of Argentina's need for cash flow relief in the near term to address the shocks its economy has endured in recent years, including from the Covid-19 pandemic.  The Exchange Bondholder Group was—and is—prepared to address those problems in the context of a process that involves transparency on the part of Argentina's representatives and meaningful compromises among the parties. 

Regrettably, the views of the Exchange Bondholder Group have not been taken into account in any way in the exchange offer proposal announced by Argentina. Rather than follow a course of constructive engagement, Argentina has instead chosen to make a unilateral offer.  Argentina's proposal does not represent the product of good faith negotiations and the Exchange Bondholder Group considers it to be unacceptable and does not intend to support it. 

The Exchange Bondholder Group remains ready to work in good faith with Argentina to address its challenges and is ready to present realistic proposals that can provide Argentina with a consensual path to a sustainable debt burden.  Argentina's path to a more prosperous future requires active support and cooperation from all sides—international and local bondholders, the IMF, World Bank and other multilateral and bilateral partners and Argentine society and its government.

The Exchange Bondholder Group is comprised of a large number of institutional investors holding Exchange Bonds governed by Argentina's 2005 Indenture.  Exchange Bonds were issued to investors who participated in the 2005 and 2010 debt exchanges in which bondholders voluntarily accepted large reductions in net present value to assist Argentina's recovery from the 2001 default. 

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