Highland Capital Management LP will be one of the buyers when Argentina re-enters the international bond market. The firm manages $19 billion in funds. According to James Dondero, the asset management company will take substantial amounts of the securities. Highland Capital Management had been the largest shareholder of the nation’s $4 billion of notes payable in 2033. That was before blending its holdings.
The company’s plan to invest is good news for Argentina as it tries to trade a record amount of debt to pay holdout creditors including Paul Singer. Additionally, it also shows that the distraught debt investors are likely to remain buyers of its debt. Dondero noted that they plan to hold what they have in the initial bonds as they look to purchase part of the new issuance. He added that they were optimistic concerning the price the debt it where it will trade.
Argentina will issue $11.8 billion worth of bonds. It will yield between 7.5 to 8 percent, according to Ministry officials. The officials noted this while submitting a debt bill meant to initiate a deal with a large number of holdouts. According to Luis Capita, Argentina’s Finance Secretary, the country will trade bonds that will mature in 5, 10, and 30 years. The debt will be issued under New York law.
Highland Capital will win big when Thomas Griesa, U.S. District Judge lifts the ban that is stopping Argentina from paying its debt. In June 2014, Highland procured the 2033 bonds. At the time, they were selling in the mid-70s. Dondero noted that Highland has received annualized returns on the bonds of 20 percent. Additionally, he said that he was tracking investment opportunities in Argentina aside from the sovereign debt. That includes the possibility of starting an Argentina fund. This information was first published on Bloomberg.com
James Dondero is the president of Highland Capital Management. He has a wealth of experience in regard to the credit and equity markets focusing on high- yield along with distressed investing. He has worked in the industry for more than 30 years. Since forming Highland Capital in 1993, James Dondero has been a pioneer in creating credit oriented solution for investors. Additionally, the development of collateralized loan obligation has largely been impacted by James Dondero.
Originally, Dondero worked as a chief investment officer for GIC, as a portfolio manager for American Express, and as a career analyst for the Morgan Guaranty training program. Dondero holds the highest honors in accounting and finance from the University of Virginia. He holds three certifications that include a CPA, CFA, and CMA.
Here is the reference link http://www.bloomberg.com/news/articles/2016-03-08/argentina-luring-highland-shows-distressed-bond-buyers-to-stay