January 1, 1998
By Leon Lazaroff
Faced with $170 million in debt coming due in 1998, Guillermo Gotelli, the straight-shooting president of Argentine athletic footwear company Alpargatas, had a cold realization: because the extreme turmoil in Asian markets was likely to keep international volatility high and liquidity low well into the year; unusual measures would have to be taken if his company were to cover its debts. In short, extraordinary conditions required extraordinary actions.
Instead of going to the international bond markets in December for a previously planned sale of $176 million of seven-year bonds, Gotelli we
Asia’s crisis shocked investors and drove liquidity out of the market and volatility through the roof. Will Latin American debtors be able to refinance or repay their maturing obligations in 1998?