Default Ain't Just a River in Turbio

Los bonos no están tan cabilla...
La vaina es que los bonos no están tan cabilla…

So this one’s inexplicably flying under the Communicational Hegemon’s radar: Sidetur, the steelmaker and one-time Sivensa subsidiary expropriated back in 2010, missed its coupon payment on $100 million worth of bonds last week, putting at least one shard of the Venezuelan public sector behemoth deeper into outright default.

According to Deutsche Bank, Sidetur first missed a coupon payment back in January, so with this missed payment it’s just heading deeper into default-land.

The markets don’t seem to be entirely freaking out about this yet, even though the government’s line on this – we only seized Sidetur’s assets, it’s up to the folks we expropriated to answer for its liabilities – is just this side of bonkers.

As signals go, it’s just really not good.

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  1. “Fitch has withdrawn the above ratings as the issuer has chosen to stop participating in the rating process. Therefore, Fitch will no longer have sufficient information to maintain the ratings. Accordingly, Fitch will no longer provide ratings or analytical coverage for Sidetur.” Great…

  2. Here is another interesting one for ya that is somehow also flying under the radar!!
    A US Oil&Gas Company wins $15 million from Venezuelan rig seizure:
    The kicker for me was: “The settlement comes from a third party not related to the nation of Venezuela or PDVSA” ????? Who is putting up the bill? and
    “The company had a similar settlement last year for $7.5 million with another unnamed company related to the rig seizures” ???

  3. I wonder who is behind Sivensa these days. Few years ago I met with one of the directors of the firms and the VP of finances. They assured me they were not under the government’s radar although they proudly expressed their market share had gone up because rebar production in SIDOR had dropped after expropriation.
    As all of us who were @#%ked by the Venezuelan government, Sidor directors only saw the storm after thunder struck.


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