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Argentina Returns to Global Debt Markets With $16.5 Billion Bond Sale

Argentina barreled back into the bond market on Tuesday with the largest emerging-market debt sale on record, attracting intense investor interest after years as a financial pariah.

The $16.5 billion global debt offering was more than double the previous highs from governments in developing countries, according to Dealogic.

Demand for the South American country’s debt was so strong that Argentina was able to both increase the initial size of the deal while also lowering the yields it offered to investors. The deal’s underwriters received nearly $70 billion in orders for the bonds, more than four times the value of the debt, said people familiar with the matter.

The giant bond offering is a milestone achievement for Argentina, which defaulted on more than $80 billion in sovereign debt in 2001, the largest government default at the time. Argentine officials engaged in years of public fighting with bondholders, with a former president blasting some creditors as “vultures.”

“We are finally at the end of the era of default in Argentina,” said Robert Koenigsberger, founder of Gramercy Funds Management LLC who helped negotiate a restructuring of Argentina’s bonds in 2009 and bought some of the new debt. “We are happy to see that resolution has come and everyone can move on.”

More broadly, the robust interest in Argentina’s bonds, which received high-yield, or junk, ratings from credit-rating firms, highlights how sharply investor attitude toward risk has changed this year.

Fund managers shunned emerging markets, along with other riskier investments like commodities and stocks, at the beginning of the year. But in recent weeks, with interest rates in Japan and parts of Europe in negative territory and with the Federal Reserve saying it would move...


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