Argentina's Bonds Rise on Hopes of a New Deal; YPF Bonds Climb on Cost Cutting
Argentina's dollar bonds rose on hopes of a new deal with its largest creditors. The country is in talks with its creditors to close a restructuring deal before the grace period ends on its $500mn overdue payments (May 22). New proposals came from a creditor group led by BlackRock, Ashmore Group and Fidelity Investments. Another joint proposal came from two groups that include Argentina Creditor Committee, Fintech Advisory, Gramercy Funds Management and the Exchange Bondholder Group. Its dollar bonds have risen by 7-11 points over the last 2 weeks.
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Argentina's state-owned oil and gas company, YPF announced cost cutting measures to shore up its balance sheet amid looming debt payments. To maintain liquidity, YPF will seek to refinance soon-to-mature debt, continue to tap local money markets, and rollover a US$1-billion bond payment due in less than a year. The company has cut salaries of some employees by 10%, people familiar with the matter told Bloomberg News. The company will also delay investments in drilling, infrastructure and refineries, and continue with divestments, said Sergio Giorgi, vice-president of strategy and business development.
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