Double dipping: Argentine entrepreneurs scoop up their old shops from exhausted foreigners. (Strategy).

At the height of Argentina's foreign investment boom last decade, Pablo Aversa and Salvador Guarracino, founders of the Freddo ice cream chain, did what most successful, family-run businesses do. They cashed out.

After decades of tirelessly building their business, Aversa and Guarracino sold it in 1999 for US$83 million to the Exxel Group, an Argentine fund backed by U.S. institutional investors. The chain expanded rapidly to 50 stores. Then service and quality slipped, customers say, just as the Argentine economy plunged into a deep recession. Fifteen of its 50 stores closed. Today, the devalued Freddo brand is a ward of the banks in search of a buyer.

Like many local entrepreneurs who sold their companies only a few years ago, the ice-cream duo is back. Or their sons are, at least. Skirting a non-compete clause that forbids the original partners from reentering the business, Aversa and Guarracino have handed over the family's 70-year-old recipe book to their sons, Federico and Juan Martin. In November, the two launched the Persicco ice cream chain under the purposely misspelled slogan "porque el helado ten (a que volver a ser ricco" (because ice cream had to go back to being good). "It's the business we know best," says Federico Aversa.

The ice-cream team is just one of several ventures re-emerging as local entrepreneurs bet they can make a buck where foreigners only see black holes. In addition to Freddo, ex-proprietors of two other Exxel-owned companies, music chain Musimundo and gourmet coffee store and pastry maker Havanna, are rumored to be trying to buy back their old companies at fire-sale prices.

Local investment group Condor Ventures bought music chain Tower Records; the California company left Argentina after suffering $400,000-a-month losses. Condor also bought the rights to the Gap and Banana Republic brands in Argentina, Brazil and Chile, rights once controlled by Exxel.

Failing Argentine banks can be had for a song these days, thanks to the economic collapse. In Argentina's wine country, meanwhile, the Santos and Benegas families lead a boomlet of small-scale boutique wineries headed by old-guard winemaking families that sold their original vineyards to international investors.

Other hot sectors for cash-laden locals: tourism and exporting. "Unfortunately for Argentina, local businessmen are all too familiar with getting things done in a volatile environment," says Christopher Eccleston, head of investment company Buenos Aires Trust.

Space invaders. Real estate could boom, too. Developer IRSA, the country's largest landlord, became the first major company to return to the international bond market in October. At least a quarter of $100 million in new IRSA bonds are expected to be used to buy undervalued properties in Buenos Aires. Office space is now cheaper than in traditionally poorer capital cities like Asuncion and Quito.

While Argentines are buying back into their economy, as sick as it is, most foreign equity investors won't touch the country with 10-foot pole. Despite bargain basement prices--most assets can be acquired for little more than a buyer's promise to assume the company's debt--macroeconomic and political uncertainty remains a major deterrent.

"Prices are mostly symbolic," says Jose Manuel Ortega, president of Symbios Capital, the private equity arm in Latin America for Spain's Banco Santander Central Hispano and a co-investor with Exxel in Musimundo. "But, for foreign investors, the country remains too risky not least because memories of the economic mishandling are still fresh."

Persicco's ice cream barons are confident that they can handle domestic chaos. In fact, they are already looking abroad. Aversa and Guarracino hijos have spent $100,000 registering the Persicco brand throughout the world. In the next few years they hope to open stores in Spain, England, the United States and Mexico.

"Out of necessity our fathers started Freddo's to look after their families," says Juan Martin Guarracino, 38. "Luckily, we had a more privileged upbringing. Our goal is to look after the business, and our market is the world."