South America

Privately held Argentine power generator Stoneway Capital Corporation has asked bondholders to postpone an amortisation payment on its senior secured bonds as delays from government energy distributor Cammesa begin to bite.

The International Monetary Fund maintained that relations with the Argentine government were “constructive” after a staff mission met economy minister Martín Guzmán on Friday afternoon.

Argentina appeared to adopt a firmer posture on debt restructuring negotiations this week, as it postponed repaying a domestic bond held mostly by foreigners. Economy minister Martín Guzmán told the country's Congress that he would “not let foreign investors set the tone for macroeconomic policy”.

The final Latin American corporate deal before a hiatus for the earnings blackout period showed that borrowers were benefiting from volatility related to Covid-19, the official name of the coronavirus outbreak. However, a prolonged scare could bring negative consequences.

Argentina's plans to restructure $67bn of debt in under two months may look naive to some but the ambition the government has so far demonstrated point towards a good outcome.

Though Latin America bond markets have so far dodged the brunt of global volatility related to Covid-19, the official name of the coronavirus outbreak, the region’s commodity dependence makes it particularly vulnerable to a China slowdown, say analysts.

Argentina’s economy ministry argued that it was acting with “simple” logic after deciding to include a domestic law dual currency bond owned mostly by foreigners in its external debt restructuring on Tuesday afternoon.

Argentina's plans to restructure $67bn of debt in under two month may look naive to some but the ambition and good communication the government has so far demonstrated point towards a good outcome.

Brazilian hospital operator Rede D’Or became the third Latin American company in a week to tap recently issued bonds as the region’s fixed income markets continue to defy coronavirus-related volatility elsewhere.

Axel Kicillof, the governor of the Province of Buenos Aires, who has an antagonistic relationship with bond investors, was forced into a volte-face on forgoing a debt payment, as Argentina’s new government seeks to maintain a good rapport with markets ahead of restructuring negotiations.

Chilean mobile phone operator WOM took advantage of a better tone in bond markets on Tuesday to add $60m to its 2024 notes, first sold in November.

The Province of Buenos Aires agreed to make an overdue bond payment on Tuesday afternoon to dodge default by just one day, as analysts said Argentina had to avoid creditor conflict to meet a tight deadline to restructure its sovereign debt.