Elliott to Continue Argentine Asset Hunt as Sanctions SoughtKatia Porzecanski
Elliott Management Corp., the hedge-fund firm run by billionaire Paul Singer, said it will continue a decade-long search for Argentine assets to enforce $1.7 billion in court judgments stemming from the country’s default.
Elliott, which successfully sued Argentina for full repayment on defaulted bonds from 2001, will also pursue sanctions on the South American nation for evading a U.S. court order to pay the New York-based company, according to a letter sent to investors and obtained by Bloomberg News. U.S. Judge Thomas Griesa found Argentina in contempt of court on Sept. 29 for disobeying his orders, which prevent payments on the nation’s overseas bonds until Elliott is paid.
“Those proceedings will be undertaken in the coming months,” the firm, which oversees $24.8 billion, wrote. “In the meantime, we will continue our worldwide hunt for Argentine assets to satisfy our judgments.”
Argentina defaulted on $95 billion of bonds in 2001. While about 93 percent of creditors accepted losses of 70 cents on the dollar in the country’s 2005 and 2010 debt restructurings, holdout investors, including Elliott, sued for full repayment.
Singer in March sued the country and Elon Musk’s Space Exploration Technologies Corp. for rights to two launch-services contracts owned by the South American nation and in 2012 tried seizing a naval vessel docked in Ghana.
The hedge fund is also investigating government funds allegedly funneled out of Argentina and into Nevada by an Argentine businessman accused of embezzling $65 million. In August, Elliott’s attorney Robert Cohen said the investigation was “just the tip of a very large iceberg.”
Argentine President Cristina Fernandez de Kirchner has said she can’t negotiate with Elliott until a key bond clause expires at the end of 2014. As a result, U.S. courts blocked the nation’s payments on overseas bonds, triggering a second default in 13 years. Fernandez hasn’t said whether she’ll pay next year, when the clause expires.
“Negotiating a resolution of its creditor disputes would have electrifying and instantaneous benefits for the country’s economy,” Elliott wrote. “However, in the past, many people have predicted that Argentina would take a turn toward ‘rational’ behavior only to see officials in Buenos Aires continue in the same radical and self-destructive decision-making.”