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ECONOMY | 11-11-2023 08:02

Argentina’s utility bondholders are still waiting for payment

Some bondholders of Argentina’s state-owned water utility are still awaiting their money more than a week after a debt payment deadline passed.

Some bondholders of Argentina’s state-owned water utility are still awaiting their money more than a week after a debt payment deadline passed, due to an apparent mix up with the trustee processing the transaction. 

Several creditors of Aguas y Saneamiento Argentinos SA, or AySA as it’s known, have not received their portions of the US$28-million principal and interest payment on the company’s 2026 dollar notes, which was due November 1, according to two people with direct knowledge of the matter, who asked not to be named because the information isn’t public.

An AySA spokesperson said the company made the payment on time, but because the bond’s trustee didn’t have updated creditor details, it caused problems when the funds were sent to the clearing house.

UMB Financial Corporation, the bond’s trustee, is working to resolve the situation, according to emails between the trustee and the company seen by Bloomberg. UMB didn’t respond to requests for comment. 

The delay adds to investors’ concerns about the troubled country just as Argentines head to the polls on November 19. The presidential election pits Economy Minister Sergio Massa against libertarian outsider Javier Milei, who has vowed to dollarise the economy, slash government spending and sell state-owned companies. 

AySA’s President Malena Galmarini is married to Massa. The Economy Ministry press office referred all questions to AySA.

AySA provides drinking water and sewage services to 14 million people in Buenos Aires and 26 districts of the city’s suburbs. The company restructured its bonds last year, extending maturities until 2026, and owes roughly $330 million on the notes, which have slumped more than 9% since May and trade at about 71 cents on the dollar, according to data compiled by Bloomberg.

The securities have a 30-day grace period in the event of a missed payment, according to the bond’s contract.

by Scott Squires, Bloomberg

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