It was a risky wager. Oil was around $15 a barrel in June 1999 when Alfonso Cortina, chief executive of Spanish oil company Repsol, shelled out $15 billion for control of Argentina's YPF. The price tag for the 85% stake, to add to the 15% it already owned, matched Repsol's total market capitalization.
Now, with oil at $25 a barrel, the 56-year-old Cortina looks more like a visionary than a gambler. The new Repsol-YPF is the world's seventh-largest oil company. That's a far cry from the government-controlled, mainly domestic operation that Repsol was when Prime Minister Jose Maria Aznar made Cortina CEO in 1996. "It was an exceptional opportunity," says Cortina of the YPF acquisition.
Before the purchase, Repsol was mainly a refining and marketing outfit. The deal bolstered its exploration and production side, bringing total reserves to 4.5 billion barrels from a mere 978 million. It has also juiced profits: They jumped 16% last year to $1.1 billion. Cortina is forecasting a 50% hike for 2000. Yet Cortina isn't sitting still. Talks on a merger with Italy's ENI broke off earlier this year, but another oil deal is likely. He's also investing in fiber optics--one more new dimension for the Spanish company.