January 31, 2020 / 4:23 PM / a month ago

Buenos Aires pushes back deadline for bondholders amid debt crunch

A man reads a newspaper as he walks in Buenos Aires' financial district, Argentina, April 18, 2016. REUTERS/Marcos Brindicci

BUENOS AIRES (Reuters) - Argentina’s Buenos Aires province said on Friday it would postpone until Feb. 3 a deadline for bondholders to accept its proposal to put off for months a $250 million repayment.

The province has now twice kicked back the deadline for responses amid a major debt crunch hitting the country. It had previously been forced to delay and sweeten the deal after struggling to convince enough bondholders.

If no deal is struck by Feb. 3, it would leave the province teetering on the edge of a technical default.

The negotiation is seen as a litmus test for talks to restructure the South American nation’s sovereign debt, including with the International Monetary Fund, which center-left President Alberto Fernandez wants to wrap up by the end of March.

The province has a 10-day grace period on the capital repayment originally due on Jan. 26, which would indicate that it would enter technical default around Feb. 5, the same day Economy Minister Martin Guzman is set to meet the IMF in Rome.

Reporting by Nicolas Misculin, writing by Dave Sherwood; Editing by Chizu Nomiyama and Steve Orlofsky

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