Argentina Debt Crisis Settled With $6.5 Billion Cash Deal

Argentina's debt crisis is being addressed by the country by settling the US hedge funds' litigation that has been running for nearly 15 years.  A court-appointed mediator said that Argentina has settled a class action lawsuit over the defaulted debt by offering $6.5 billion.

Daniel Pollack, a New York lawyer handling the settlement, claimed that Argentina's debt crisis has been resolved partly with the nation's proposed offer early this month, Reuters reports.  The deal is aimed at settling various proceedings by creditors of the defaulted bonds. It is not yet confirmed how many holders of the defaulted bonds will be covered.  Pollack assured that holders who will participate would be paid with 100% of the principal and 50% of the interest.

"This shows that the proposal is good and that we are continuing to advance positively. We hope that there will be more agreements in the coming days," said a source in the Argentine finance ministry.

As Yahoo reported, Argentina's debt crisis has been settled about two weeks after Pollack said that two out of the six prime bondholders settled more than $1 billion claims. The $6.5 billion deal comes after President Mauricio Macri, who assumed his position last month from leftist leader Cristina Kirchner proposed paying the initial amount from its $100 billion default in 2002. Kirchner refused to pay the hedge funds and called the creditors "vultures," according to Business Plus TV.PK.

"This litigation has gone on for nearly 15 years since the original Argentine default of 2001, and the proposal by Argentina is an historic breakthrough," Pollack said.

Argentina's debt crisis settlement with US creditors follows Macri's settlement with Italian bondholders wherein his government agreed to pay $1.35 billion to settle their $2.5 billion in claims. Macri has expressed his desire to renew ties with foreign countries after the country suffered great loss under Kirchner.

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Argentina Debt Crisis, Argentina debt, Mediator, US hedge funds, Argentina class action lawsuit, President Mauricio Macri, Cristina Kirchner

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