The national government wants Buenos Aires Province to be the first to resolve debt restructuring talks after its own sovereign bond agreement, according to sources with direct knowledge of the matter.
The government's strategy is to prevent debt restructuring talks from other provinces from complicating negotiations related to Buenos Aires Province. thus preventing creditors from demanding better conditions, said the individuals, who asked not to be identified because the negotiations are private.
The provincial government in La Plata resumed talks with its creditors last week after a consensual pause. Both bondholders and officials had agreed to delay negotiations until after the national government own restructuring talks were resolved.
Buenos Aires Province's proposal includes a net present value of three to seven points higher than the nearly 55 cents on the dollar in the country's inception agreement, two sources told Bloomberg.
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Buenos Aires Province bonds due 2027 are trading at nearly 50 cents on the dollar, from a low of 25 cents on the dollar in May, according to data compiled by Bloomberg. Representatives from the provincial and national economy ministries declined to comment.
Argentina's provinces, having less debt overall, are willing to pay a substantially higher net present value, the sources said. Mendoza Province is offering a valuation of 80 cents on the dollar, they added.
by Ignacio Olivera Doll, Bloomberg