In about-face, Greece to pay May 15 bond swap holdouts

Renee Maltezou - Reuters

(Reuters) - Greece made a last-minute decision on Tuesday to pay bondholders who refused to accept a debt restructuring, a move that may set a precedent and infuriate creditors who accepted just cents on the euro for their investment in a historic bond swap.

In an about-face, Greece opted to pay holders of 430 million euros ($552 million) of a May 15 bond, despite having told those who took its bond swap offer in March that they would otherwise get nothing, government officials told Reuters on Tuesday.

The decision averts litigation by the bondholders, and will infuriate the 96.9 percent of creditors, mainly European banks, who agreed to take the deal.

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May 15, 2012