James Dondero was quoted in a recent Bloomberg Business article. He explained why he and his firm, Highland Capital Management, had been expecting Argentina to be forced into releasing their debt onto the market. Price manipulations were occurring. The government had implemented very bad tax policies. There were massive subsidies, less production and they were running down their foreign reserves. This did not make sense to James Dondero because the country is so resource rich. The only answer was that they were going to reach an inflection point. They knew that the bonds would trade higher because they were going to be forced to settle with holdouts.
According to the article, in April Argentina wants to release 7.5 to 8 percent yielding bonds. They should issue 11.68 billion dollars of the bonds in worth. The Finance Ministry wants to create deals with their holdouts and is trying to do this with a new debt bill that they are showing congress. Their plan is to sell 5 year, 10 year and 30 year maturity bonds that will be issued under New York state law. There are expectations that the yields will fall to 6 percent over the short term because of optimistic outlooks for Argentina’s monetary and fiscal problems, as well as ratings upgrades.
James Dondero has been leading his firm to make moves like this since he founded it in 1993. He made the decision to venture into developing a market for collateralized debt and loan obligations and the firm also specializes in created credit oriented solutions for clients. Dondero has also helped the firm to expand in other areas. The firm now also offers structured products, long and short equity, high yield credit, distressed and special situations, emerging markets, health care and real estate. The firm has also received multiple awards, such as Pensions & Investments Best Places to Work in Money Management, Creditflux Manager Awards Finalist for Best HY Hedge Fund, and The Street Best Stock Mutual Fund, Long or Short Category.
Jim Dondero, after earning his dual degree in accounting and finance, got certified as a CPA, CMA and CFA to further his knowledge. Jim prides himself as being an active member of his community and sits on the board of several organizations, including MGM Studios, American Banknote, and CCS Medical.
To read the whole article, please go here: http://www.bloomberg.com/news/articles/2016-03-08/argentina-luring-highland-shows-distressed-bond-buyers-to-stay