Holders of Argentina's defaulted Par bonds are banding together to increase their leverage with the sovereign, using the threat of possible payment acceleration to strengthen their position. About a dozen funds have been in talks with Chicago law firm Kirkland & Ellis, people familiar with the situation told IER, with an eye to gaining at least 50% control over a single series of Argentina's outstanding bonds. At the 50% threshold, the bloc would be able to start - and stop - so-called acceleration, allowing holders of the defaulted bonds to demand immediate repayment of principal and interest. But many lawyers, analysts and investors say acceleration would be a risky path in dealing with Argentina, which went into its second default in 13 years in July amid a long-running legal battle. The move would add to the uncertainty around Argentina's fight with holdout creditors led by Elliott Management, who are owed US$1.33bn plus interest, according to a US court ruling.
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