THE IN­VOLVE­MENT OF PAUL SINGER

Finweek English Edition - - INSIGHT -

The emer­gence of vul­ture funds with the 1996 El­liott As­so­ciates, LP vs Repub­lic

of Panama case opened up a new le­gal op­tion to force sov­er­eign gov­ern­ments to pay the full value of their debts (plus in­ter­est), rather than the dis­counted amounts ar­rived at through ne­go­ti­a­tions ar­bi­trated by the In­ter­na­tional Mon­e­tary Fund and other in­ter­na­tional in­sti­tu­tions. The face value of the dis­counted Ar­gen­tine debt that El­liott bought af­ter the coun­try’s 2001 de­fault for $48m is to­day $630m. The fund wants re­pay­ment for the full value of the debt, as it did in 1995 with Panama. This amounts to $1.5bn, which could rise to $3bn in­clud­ing in­ter­ests and fees.

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