MercoPress. South Atlantic News Agency

Argentina says creditors willing to swap bonds; holdouts warn about “contempt of court”

“Many bondholders have expressed publicly their will to accept new bonds of sovereign payment,” Capitanich told reporters

Argentina's Cabinet Chief Jorge Capitanich said on Friday that “many” creditors are willing to accept a change in payment location to collect their money as the ongoing legal dispute with the holdouts continues to endanger the country's international credit and reputation.

 “Many bondholders have expressed publicly their will to accept new bonds of sovereign payment,” Capitanich told reporters at the government house.

However in a teleconference presided over by the head of the American Task Force Argentina (ATFA) Robert Shapiro, NML Capital Senior Legal Counsel and Dechert Partner Robert A. Cohen warned that “any third party” that agreed on the local payment of debt set by a bill that has been just passed by the Senate, could face a “contempt” of court motion and put their activities “at risk.”

“It is a blatant violation of the court orders because it prohibits the change mechanism and the judge specifically said it would be illegal and must not happen. Argentina has chosen to ignore that and we will be taken the proper steps to make sure that plan is not implemented and that third parties are held in contempt of court,” Cohen said.

He emphasized that “it is obvious that any third party that participated in the effort to evade (the court ruling) will subject itself for contempt and damages for their activities; their activities would be at risk.”

But cabinet chief Capitanich defended the Argentine government move to have a new dept swap approved by Congress, (it has already got a Senate passing earlier this week), defying a ruling from US Federal Judge Thomas Griesa which insists that holdouts must be paid (1.3bn dollars plus interests) at the same time as the 2005 and 2010 restructured bonds.

“There were 9.000 judicial actions at international level” revealed Capitanich regarding holdouts attempts to seize Argentine assets. Of that number 130 still prevail.

“It is a standing aggression by vulture funds” insisted Capitanich. “Actions have been permanent; we have seen it with the Libertad Frigate in Ghana” even when “multiple embargos” against Argentina have been “rejected.”

In the 50-minute call, Cohen explained NML was following investigations by Argentina’s attorneys Guillermo Marijuán and José María Campagnoli over alleged funds of business tycoons Lázaro Báez and Cristóbal López.

“Funds that will be recovered for our clients,” the lawyer said alluding to “millions of dollars” that Báez and López would have “laundered” for the Cristina Fernández administration and Kirchner family abroad.

When asked about NML’s strategy to “recover” Argentine assets and if in that agreements reached with Chevron to develop the resource-rich Vaca Muerta region in the southern province of Neuquén could be jeopardized, Cohen said they were “looking to all activities to recover our assets.”

“It will be a mistake to disclose our strategy (but) we are looking to all activities to recover our assets,” he said.