By Prabha Natarajan
YPF SA (YPFD.BA, YPF) is in the market with a $500 million
global bond issue Monday.
This is the first time the Argentine energy producer is raising
debt after the government last year expropriated a majority stake
held by Spanish oil company Repsol (REP.MC).
Emerging-market companies have seen increased investor interest
in their debt as they provide higher yields than comparable
sovereign bonds. Market participants say they are trying to
determine if YPF is tapping the market to finance capital
expenditures or to partly finance the nearly $5 billion it has
agreed to pay Repsol for the stake.
"The question is why do they need the cash," said Siobhan
Morden, head of Latin American strategy at Jefferies LLC.
YPF, previously has issued only one bond that has $150 million
outstanding and carries a 2028 maturity date. Over the past year,
it has turned to raise debt in the local market.
If YPF ends up using the money in Argentina, it would be
beneficial to the country which faces a scarcity of dollars, Ms.
The five-year bond has an initial guidance of a 9% yield and is
expected to price before end of day. YPF has a speculative-grade
rating of B3 by Moody's and B- by Fitch Ratings.
Write to Prabha Natarajan at email@example.com
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