Repsol Shareholders Approve YPF Deal

Repsol Shareholders Approve YPF Deal

Repsol’s Annual General Meeting ratified the “Convenio de Solución Amigable y Avenimiento de Expropiación” which recognises the company’s right to receive $5 billion as compensation for the expropriation of the 51% shareholding in YPF and YPF GAS, together with payment guarantees, the company said in a statement.

The agreement stipulates that the Government of Argentina will transfer to Repsol dollar-denominated public debt, through a fixed income portfolio for a nominal value of $5 billion plus an additional $500 million in capitalised interest comprised of the following bonds: Bonar X ($500 million), Discount 33 ($1.25 billion) and Bonar 2024 ($3.25 billion); and a complementary portfolio for a maximum nominal value of $1 billion made up of the following bonds: Boden 2015 ($400 million), Bonar X ($300 million) and Bonar 2024 ($300 million). The transferral of the complementary bonds will be adjusted so that the market value of the bonds is no less than $4.670 billion and up to a maximum nominal value of $6 billion.

Having obtained the ratification by Repsol’s Annual General Meeting, the agreement remains subject, amongst others, to approval of a law especially sanctioned by the National Congress of Argentina. The transaction will be complete upon the delivery of bonds in Repsol’s favour with full guarantees in their deposit through an international financial clearing entity. Repsol is free to sell these bonds. If the sale proceeds were to exceed $5 billion (excluding costs and interest), the excess would revert to the Republic of Argentina.

Press Release, March 31, 2014; Image: Repsol