Go Freelance Jobs

Argentine Bonds Are Back in Play and Highland Capital is Ready

Argentina is poised to sell $12 billion in debt in the next few months, and Jim Dondero’s Highland Capital Management fund is ready to buy according to a recent post on Bloomberg.com (the full text of the post can be found at http://www.bloomberg.com/news/articles/2016-03-08/argentina-luring-highland-shows-distressed-bond-buyers-to-stay). After suffering a contentious few years under the leadership of Cristina Kirchner who’s economic policies were suspect at best and resulted in the nation defaulting on it sovereign debt, the new leadership is ready to put the country back on the fast-track to economic recovery. Since taking office on Dec. 10, 2015, the new president, Mauricio Macri, has been proactive in regaining access to the world markets and finding ways to resolve the $95 billion in defaulted bonds.

This new issue of bonds will help resolve some of those lingering issues, especially the defaults to a group of investors led by Paul Singer. The bonds will be issued with maturities of 5, 10, and 30 years are are expected to yield around six percent in the short-term but have a stated yield of 7.5 – 8 percent. The bonds will be compliant with New York state law.

James Dondero is bullish on the new Argentine debt and expects his company to purchase a substantial amount of the new debt. Already holding a significant number of the 2033 maturity bonds, Highland’s has experienced gains of around 20% on that debt. The company stands to gain even more with the ban is lifted allowing Argentina to begin making payments on its restructured debt. That ban has been in place by a United States District Court as a result of several lawsuits brought against the country by investors.

Dondero is the co-founder of Highlands Capital Management, a Dallas, Texas-based investment and hedge fund. Since its inception in 1998, Highland Capital has gained an impressive array of awards and industry acclaim. For example, the Highlands Long/Short Healthcare Fund recently won the 2015 HFM US Hedge Fund Performance Award which looks not only at a fund’s performance but also customer and investor relations, management history and tenure, and other non-financial factors.

Jim Dondero began his career after graduating with honors from the University of Virginia with degrees in both accounting and finance. After the successful completion of Morgan Guaranty’s training program, Jim accepted a position with American Express. While at American Express, Jim was approached by Protective Life who sought him to help lead the launch of their planned GIC subsidiary. Within four short years, James Dondero┬áhad managed to grow the fund to over $2 billion in assets under management.

Follow James on Facebook today!

Leave a Reply