Latest news with #EtonPark
Yahoo
13 hours ago
- Business
- Yahoo
YPF turnover ruling casts shadow over Argentina shale hopes, FX
By Eliana Raszewski, Leila Miller and Jorge Otaola BUENOS AIRES (Reuters) -A dramatic ruling by a U.S. court ordering Argentina to hand over the 51% stake it holds in state energy firm YPF has cast a shadow over the country's plans for its huge Vaca Muerta shale formation and hopes to return to global markets. U.S. District Judge Loretta Preska said on Monday that Argentina must transfer its YPF shares within 14 days to partially satisfy an earlier $16.1 billion court judgment against the country over its 2012 nationalization of the firm. The government of pro-market libertarian Javier Milei said it would appeal the ruling to "defend national interests." The judgment adds uncertainty to Argentina's plans to turn Vaca Muerta, the world's No. 2 shale gas reserve and No. 4 for shale oil, into a key global energy producing region that would help bring in foreign currency needed to prop up the economy. YPF leads development of Vaca Muerta, often partnering with other local and international firms including Shell and Chevron. Vaca Muerta has hit production of over 400,000 barrels per day of oil and some 70 million cubic meters of gas per day. "Control of YPF is important for Milei; that's why an appeal is the only option for him," said Marcelo García, director for the Americas at New York-based risk consultancy Horizon Engage. "YPF leadership in Vaca Muerta is crucial for the medium- to long-term sustainability of his economic program, because it should bring the U.S. dollars the economy lacks." The legal dispute arose from Argentina's 2012 seizure of the 51% YPF stake held by Spain's Repsol, without tendering for shares held by minority investors Petersen Energia Inversora and Eton Park Capital Management. In 2023, Preska awarded $14.4 billion to Petersen and $1.7 billion to Eton Park in the same case, which Argentina is also appealing. The plaintiffs are represented by litigation funder Burford Capital, which expects to receive some 35% and 73% of Petersen's and Eton Park's respective damages. The legal ruling could also dent Argentina's ability to tap global markets, something the country is keen to do to bolster its depleted reserves after years of currency crises, regular fiscal deficits draining state coffers and high inflation. "These unresolved disputes could hinder, or even block, Argentina's return to the international capital markets," BancTrust & Co said in a note on Tuesday. García added that surrendering the shares in YPF would constitutionally need the approval of Argentina's Congress, which was unlikely to happen, adding a more realistic outcome was that it would force Milei to negotiate. "Surrendering YPF is politically not viable in Argentina today. But the ruling does force the administration to the negotiating table and gets Milei's attention on the case." Argentina's government must urgently build up foreign currency reserves to pay its debts and meet targets as part of a $20 billion loan program agreed with the International Monetary Fund in April, the indebted country's 23rd IMF program. YPF's U.S.-listed shares slumped more than 5% on Monday, while Burford's stock price jumped. Both steadied on Tuesday. YPF's current market capitalization is around $12.5 billion. (Reporting Eliana Raszewski, Leila Miller and Jorge Otaola; Writing by Adam Jourdan; Editing by Marguerita Choy)
Yahoo
20 hours ago
- Business
- Yahoo
Argentina seeks to halt $16bn YPF judgement enforcement in UK court
Argentina has approached London's High Court to request a suspension on the enforcement of a judgement valued at more than $16bn, concerning its nationalisation of oil and gas company YPF. According to a report in Reuters, the legal move is part of Argentina's broader strategy to appeal the decision in the US, where a New York court in 2023 had ruled in favour of Petersen Energia Inversora and Eton Park Capital Management. Supported by litigation funder Burford Capital, these entities have claimed they are owed an amount exceeding $17bn, including interest accruing at an estimated rate of $2.5m per day. The origins of this legal dispute trace back to 2012 when Argentina took control of a 51% stake in YPF from Spanish company Repsol. This action was undertaken without extending an offer to purchase shares held by minority investors, prompting the current legal claims. Argentina has contested the ruling from the US court and is also challenging its enforcement in the UK. During proceedings at London's High Court, Argentina's legal representative David Railton advocated for pausing the case until the appeal process concludes in the US. He argued that investors would face no disadvantage since "there are no assets here against which the judgement can be enforced". In contrast, Petersen Energia Inversora and Eton Park Capital Management have alleged that Argentina is attempting to postpone enforcement. Their legal counsel, Paul McGrath, argued that if the court considers a pause, then Argentina should be required to provide security estimated at $2.5bn. Originally established as a state-owned enterprise in 1922, YPF underwent privatisation in 1993 via a public offering on the New York Stock Exchange (NYSE). As part of this transition, bylaws were updated to stipulate that should government control exceed 49%, minority shareholders must be offered buyouts at an established price. This process included specific notification requirements through New York's financial channels and filings with relevant authorities. The Argentinean Government under then-President Cristina Fernández de Kirchner did not adhere to these requirements during the 2012 nationalisation. At that time, Petersen Energía Inversora and Eton Park Capital Management collectively owned more than 25% of YPF's shares. Petersen's inability to manage its debts due to halted dividend revenue from YPF led to its bankruptcy and subsequent 2015 lawsuit against Argentina for breach of contract; Eton Park filed a similar lawsuit in 2016. "Argentina seeks to halt $16bn YPF judgement enforcement in UK court" was originally created and published by Offshore Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Reuters
2 days ago
- Business
- Reuters
US judge orders Argentina to transfer YPF shares to help satisfy $16.1 billion judgment
NEW YORK, June 30 (Reuters) - A U.S. judge on Monday ordered Argentina to give up its 51% stake in oil and gas company YPF ( opens new tab, to partially satisfy a $16.1 billion court judgment against the cash-strapped country. U.S. District Judge Loretta Preska in Manhattan said Argentina must transfer its YPF shares within 14 days to a BNY Mellon custody account, and instruct that bank to transfer the shares within one business day to the plaintiffs. Argentina has been appealing Preska's September 2023 decision to award the $16.1 billion to Petersen Energia Inversora and Eton Park Capital Management, which are represented by litigation funder Burford Capital (BURF.L), opens new tab.
