U.S. Judge Lets Ecuador $17.4 Billion Debt-Swap Deal Proceed

A federal judge in New York denied a request by two U.S. investment firms for a temporary restraining order blocking Ecuador’s plan to restructure $17.4 billion in sovereign debt.

Ecuador had argued that a significant delay could lead to a “massive, cascading default” for the South American nation. U.S. District Judge Valerie Caproni in Manhattan on Friday denied the motion by two U.S. investment firms opposed to the debt-swap plan. Boston-based GMO, and Contrarian Capital Management LLC, a Greenwich, Connecticut hedge fund had called its offer to investors of 91 cents on the dollar “coercive in the extreme.”