Author: Archive

Bondholders are concerned about Argentina-based Sideco Americana S.A.’s ability to service debt after a subsidiary recently filed for bankruptcy. But an official at Sideco, which has interests ranging from toll roads to waste management, says the company doesn’t anticipate problems making payments on its debt or in refinancing existing credit lines. He says the company now is in a better position to cope with $260 million of bank debt coming due over the next 12 months and $125 million of bonds due in August, 2002 – which together represent more than half of the company’s $628 million in total debt. Investors are focusing on Sideco’s postal unit, Correo Argentino S.A., which has been involved in a long-running dispute with the government over payments each side owes the other. In September, Correo filed for the Argentine equivalent of Chapter 11, or ‘Concurso Preventivo.’ Standard & Poor’s, which in September cut Sideco debt ratings two notches to triple-C, contends that the resulting creditor protection will make it tougher for Sideco to refinance debt and ‘may constitute an event of default.’ Now, some people in the markets believe Sideco’s prospects for debt refinancing have grown worse because of steps the government is taking to shore up the financial system.