Argentina Plans to Offer 100-Year Bonds
Claire Boston, Charlie Devereux and Ben Bartenstein
Argentina is planning to sell its first 100-year bond a year after returning to global capital markets, as it grapples with a soaring budget deficit.
The bond, which will be used to shore up its budget and refinance debt, may be priced as soon as Monday and yield about 8.25 percent, according to a person with knowledge of the matter, who asked not to be named because the deal is private. Citigroup Inc. and HSBC Holdings Plc are managing the sale. The debt-issuance plan was announced on Twitter by the Argentine Finance Ministry, which hasn’t provided further details.
“Good for them,” said Michael Roche, a New York-based fixed-income strategist at Seaport Global Holdings LLC who recommends buying the debt given the 8.25 percent indicated yield. “Spreads are low and looking stalled, so they should lock them in for as long as possible.”
Argentina will join Mexico, Ireland and the U.K. in selling debt that matures over a century. While Argentina last year sold what was at the time the largest emerging-market bond on record, the move will test investor resolve on Argentina. As well as seeking to close its fiscal deficit, the south American country has defaulted seven times in 200 years.