Argentina's New Bonds Gain in Early Trading Amid Jumbo Saleby
Argentina seeks to sell as many as $16.5 billion in bonds
'Grey market' trading shows high demand for issuance
Argentina hasn’t yet officially pulled off its historic return to international capital markets, but already the bonds it’s planning to sell are rallying.
The 30-year bonds being marketed Tuesday traded at about 3 cents above par, while 10-year notes traded about 2 cents above par in the so-called gray market, according to Jorge Piedrahita, the chief executive officer at brokerage Torino Capital in New York and Russ Dallen, a managing partner at Latinvest in Miami. The gray market, done on a when-issued basis, allows investors to trade bonds before the debt has officially been sold.
Argentina is seeking to sell as much as $16.5 billion in bonds, a record amount for an emerging-market government and the South American nation’s first international debt sale in 15 years. About $10 billion of the proceeds from the bond sale will go toward repaying creditors who sued the country after its 2001 default, led by billionaire Paul Singer. President Mauricio Macri, who took office in December, vowed to resolve the legal dispute with creditors and lure foreign investment to the country.
“The high demand for this deal is testament to the fact that people believe in Macri and they believe in Argentina settling this problem," said Dallen, who put in orders for the 30-year tranche of the sale.
Deutsche Bank AG, HSBC Holdings Plc, JPMorgan Chase & Co., and Banco Santander SA are global coordinators for the offer. Banco Bilbao Vizcaya Argentaria SA, Citigroup Inc., and UBS Group AG are joint bookrunners.