In early October, we posted about the Argentine Navy training ship Libertad, a 300′ three masted full rigged ship, that had been seized in the port of Tema, Ghana as a result of a court order obtained by NML Capital Ltd., a subsidiary of Elliot Capital Management, a vulture fund run by the US billionaire Paul Singer. The conflict intensified last week when the ship’s crew drew guns when the port officials attempted to board and move the ship to another berth. The ship had previously raised its gangway. The officials attempted to board via a crane but stopped when faced by armed crew. The Libertad is currently occupying a central berth in the port and is blocking the unloading of some 20 other vessels.
Previously the Libertad‘s 279 cadets were flown home, leaving the captain and a crew of 43. Port officials have shut off water and electricity to the ship.
Argentina’s Foreign Minister Hector Timerman announced that if Ghana does not free the ARA Libertad by Tuesday, Argentina will appeal the seizure of the ship before the International Sea Tribunal in Hamburg, Germany.
As reported by the Wall Street Journal:
Argentina has been battling with creditors since its massive default. It has been paying those who took a restructuring deal of about 33 cents on the dollar for 93% of the defaulted bonds. But it has refused to pay NML and other “holdouts” demanding full payment.
A U.S. appeals court in late October ordered Argentina to begin paying the holdouts alongside the other bondholders. Specifics are being ironed out by federal Judge Thomas Griesa in New York, who warned Argentina at a conference Friday of possible sanctions if it chooses to ignore the orders.
In a speech Friday, Argentina President Cristina Kirchner said “the U.S. justice system is violating its own laws.” She said that the funds bought the bonds for 5 pesos and now want to collect 100.
The seizure of the ARA Libertad even briefly became an issue in the presidential election when it was revealed that Ann Romney had at least $1 million invested in Singer’s funds. Singer was a major contributor and senior adviser to the Romney campaign.