Burford Capital secures $16.1 billion judgment against Argentina

Burford Capital Ltd. recently celebrated a huge legal win against the Argentine government, winning a judgment of $16.1 billion on claims it purchased for only $17 million. This victory raised hopes that the new pro-business President Javier Milei would quickly settle the case. However, no talks have taken place since he took office over a year ago. Gerardo Mato, the representative hired by Burford to negotiate, stated that he has yet to meet with any Argentine officials. He contacted the Economy Ministry for discussions but reported there was no progress. Every day, Argentina's debt grows by $2 million, now exceeding $17 billion due to interest. This outstanding judgment could also hinder Milei's efforts to attract foreign investment. Argentina initially expressed willingness to issue a bond to cover part of Burford's claims, but no movement has occurred in that direction. An appeal against the judgment is underway, but Mato believes a settlement would be advantageous for both sides and would help improve the perception of Argentina among global investors. Mato indicated that if Burford’s judgment is upheld on appeal, it might complicate Argentina's return to international capital markets. He emphasized the importance of respecting the rule of law and suggested that negotiations could lead to a better outcome for the government, reducing their total debt payments. Burford Capital aims to secure its financial interests while showing patience. The next court decisions could take years, and discussions between Burford and Argentina remain stagnant despite the importance of the situation. Burford Capital, founded in 2009, is known for funding legal claims. Following the significant ruling in favor of Burford, its stock price increased significantly from about $7 to over $16, where it currently sits. This legal contention arises during a critical time for Milei as he seeks to manage inflation and negotiate with the International Monetary Fund.