FONT-SIZE Plus   Neg

Argentina Gears Up To Take Control Of Repsol's YPF

Spanish oil giant Repsol YPF SA (REPYY.PK) on Monday said the Argentinian Government has initiated a process of parliamentary approval of a law for a change in control in YPF. With this, 51 percent of YPF's Class D shares owned by Repsol will be declared of public interest and subject to expropriation.

Also a decree has been approved by the Argentinian Government with immediate effect, establishing the administration of YPF for a 30-day period. A Minister of the Government was appointed as Controller with all the powers of the Board of Directors.

Repsol owns a 57.43 pecrent stake in YPF, with a book value as of December 31, 2011 of 4.122 billion euros. YPF represented 25.6 percent of the group's operating income and 21 percent of net income. During last year, YPF represented 33.7 percent of the group's total investments.

At year-end, Repsol YPF had an outstanding loan valued at 1.542 billion euros to the Petersen Group. As a consequence of the decision by the Argentinean Government, the group's net debt will be reduced by nearly 1.600 billion euro.

Repsol said the measure was "manifestly unlawful and gravely discriminatory, that its public interest has in no way been justified and clearly contravenes the obligations undertaken by the Republic of Argentina during the privatisation of YPF, breaching the most basic principles of legal certainty and of reliance by the international investment community."

The company intends to take legal action against the government move to preserve the value of its assets and the interests of shareholders.

The move by Argentine President Cristina Fernandez is expected to draw criticism from foreign investors, while antagonising the government in Spain. Fernandez has been expressing concerns that the country is not managing its own resources.

The stock closed in Madrid on Monday at 17.48 euros, up 0.05 percent, on a volume of 9.19 million shares.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
As the Black Friday din settles down, it is time to look back at how various players and products fared and Adobe has offered some insight into just that. Mobiles and smartphones sold like hot cakes, according to online shopping data released by Adobe. After nearly a 2-year hiatus following its announcement that it is testing unmanned drones, Amazon finally offered a glimpse into the prototype and its functioning. It remains to be see if the company can work around regulatory hurdles to make it a reality. Microsoft's (MSFT) office assistant Cortana for iOS beta has arrived, but only 2000 people will be able to test the virtual assistant.
comments powered by Disqus
Follow RTT