Department carrying on duties as normal, according to email
The IR team at YPF insists it is trying to carry on as normal, despite the forced nationalization of the company by the Argentinian government this week.
Last week, President Cristina Fernández de Kirchner announced her government would seize the 51 percent stake of the company owned by Spanish oil & gas company Repsol.
Argentina is currently implementing a bill to allow for the nationalization, although it has already cut YPF’s computer links with Repsol and barred Spanish executives from the company’s offices, according to media reports.
The Senate approved the bill by 63 votes to three yesterday and is expected to receive final legislative approval in the Chamber of Deputies next week.
The IR department at YPF says in an email that the situation is more complex than most reports have made out, given that the government has not yet taken actual ownership of Repsol’s stake.
‘However, we are working normally, receiving and talking to investors and equity and fixed income analysts, complying with CNV [Argentina’s National Securities Commission], SEC, BCBA [the Buenos Aires Stock Exchange] and NYSE rules, and communicating with the market,’ the department writes in an email.
YPF has a three-person IR team led by IR manager Gabriel Abalos.
Disputes over whether Repsol sufficiently invested in oil source development and production – and the hard reality of Argentina having become a net oil & gas importer – led to the expropriation of a 51 percent stake from Repsol.
The move gives the country’s struggling economy access to billions in cash and a ready supply of petroleum for cheap energy, albeit at the expense of company earnings and shareholders.
The situation has put shareholders into limbo. The Eskenazi family will not lose its significant stake in YPF, nor will other minority shareholders, but that may be of little comfort.
In particular, the Eskenazis took out $2 bn in loans to pay for their shares and previously depended on now-discontinued dividends to cover the payments.
Many US-based investors have sold their interests, with American depository receipts of YPF having fallen by a third since the takeover. YPF shares are down 57 percent since the beginning of the year.
Spain has begun to use trade sanctions against Argentina in an attempt to force reconsideration, and could expand the scope.
Repsol has threatened potential lawsuits against companies that invest in YPF after the renationalization.
YPF started in 1922 as a state-owned/operated oil company. It was privatized in the 1990s after a long period of political instability, losses and alleged corruption.
Repsol, a Spanish petroleum company, bought a controlling interest in 1999 and, between 2000 and 2008, owned about 99 percent of the company’s stock. Repsol then became Repsol YPF.
The company sold a more than 25 percent interest in YPF to the billionaire Eskenazi family through the latter’s Grupo Petersen, as well as other portions to additional parties.
