Hedge fund Elliott took on one South American government a decade ago and made billions. It’s poised to do it again.
An Elliott affiliate, Amber Energy, in November won a messy, court-supervised bidding war for Citgo, once owned by Venezuela’s state oil company. Citgo’s assets — principally three US refineries and the brand license on thousands of gas stations — had been forced to the auction block to satisfy claims after Venezuela defaulted on some of its bonds. Elliott had bought many of those deeply discounted bonds and folded their face value into its bid.
But the Maduro government strongly opposed the sale, and it was unclear whether the court order would be enforced, or what condition the assets would be in. Delcy Rodríguez, who as Venezuela’s vice president called the $5.9 billion sale “fraudulent,” now says — under threats from Trump about the cost of opposing the White House’s oil-first agenda — that she’s willing to work with Washington.
Elliott is most famous for a showdown with Argentina a decade ago, also over soured sovereign debt. The hedge fund briefly seized the Argentine navy’s flagship and, after a long legal fight, made a reported 392% return on its investment. Its latest Venezuelan gambit could be just as lucrative; analysts estimate Citgo’s assets are worth around $12 billion. As of Monday, Amber executives had not yet heard from the US government about the next steps, a person familiar with the matter said. A spokesperson for Elliott declined to comment.