YPF SA climbed the most in three years after Mexican billionaire Carlos Slim became the fourth-largest stakeholder in Argentina’s top oil producer.
Slim controls 32.9 million of YPF’s Class D shares, or an 8.4 percent stake worth $345 million, according to a regulatory filing yesterday from the Buenos Aires-based company. A loan default prompted Argentina’s Eskenazi family to transfer the creditors. Slim’s Grupo Financiero Inbursa SAB was among banks that received YPF shares as collateral after the default, said Arturo Elias, a spokesman for Slim, the world’s richest person.
“We view it as a solid company with good growth potential,” Elias said in a telephone interview from Mexico City. Slim is analyzing whether to retain the stake, he said.
Argentina seized 51 percent of YPF from Repsol SA in April as President Cristina Fernandez de Kirchner’s government seeks to halt declining oil output and stem fuel imports that doubled to $9.4 billion last year. The government opposed YPF dividends, which were favored by the Eskenazi family, operators of YPF before the seizure. The Eskenazi-owned Petersen Group had used YPF dividends to meet obligations until defaulting in May on a $1 billion loan that used a YPF stake for collateral.
YPF’s American depositary receipts gained 7 percent to close at $11.17 at 4:15 p.m. in New York, after earlier soaring as much as 21 percent, the most since March 2009. The ADRs have plunged 70 percent this year as of yesterday’s close.
“It’s great that someone powerful behind this stock has seen there is a big opportunity here,” said Marcus Sequeira, an analyst at Deutsche Bank AG in New York. Slim may be looking to “position for the long-term. You can’t buy this stock for one or two years.”
Slim’s company didn’t acquire the rights to Eskenazi’s debt after the default, Elias said in an e-mailed response to questions today. Inbursa informed YPF that it isn’t interested in increasing its stake, YPF said in a regulatory filing today.
Two units of the Eskenazi’s Petersen Group transferred shares used as collateral to a group of banks on June 11 after defaulting on a loan, Petersen said today in a U.S. Securities and Exchange Commission filing. The filing contradicts a YPF SEC filing yesterday that said the Eskenazis were forced to sell 25.9 million shares to Inbursa because of the default.
The default sparked cross-defaults on three other loans, one of which had been issued by banks and the other two by Repsol. Before the defaults the Eskenazis owned 25 percent of YPF.
Credit Suisse AG, Goldman Sachs Group Inc., BNP Paribas SA, Banco Itau BBA SA, Standard Bank Group Ltd. and Citigroup Inc. were the lending banks and took 19 percent of YPF after the Eskenazi default. Repsol took the family’s remaining 6 percent.
The acquisition makes Slim the fourth-largest YPF stakeholder, behind the government, Madrid-based Repsol and the group of banks led by Credit Suisse.
Under the terms of YPF bylaws, Slim’s stake entitles him to name a member on the next board. The current board was elected last month.
The Argentine government, which said Repsol under invested since it acquired YPF in 1999, wants to tap shale reserves that may hold at least 23 billion barrels of oil equivalent in the country’s south.
YPF, Argentina’s largest oil producer, will invest $7 billion in 2013 as it plans to double exploration in five years and boost refining, Chief Executive Officer Miguel Galuccio said June 6. The company targets investments of $1.2 billion in shale oil next year, he said.
“The incorporation of the Mexican businessman in the shareholding ranks of the company is a clear signal to the international financial market,” Galuccio said in a separate statement. “It’s a great show of confidence in Argentina and the company’s new initiative.”
Slim, 72, has been dabbling in oil investments for years, including stakes in oil services company Bronco Drilling Co. in 2008 and Allis-Chalmers Energy Inc. in 2007. Both companies were later acquired.
Slim’s Grupo Carso SAB holding company has an oil services unit which counts Petroleos Mexicanos, the Mexican state-owned producer, as its client. The unit, which had sales of 3.1 billion Mexican pesos ($223 million) last year, announced a $205 million contract last week to provide three offshore platforms for Pemex.
Last year, Carso agreed to pay $23.3 million for a 70 percent stake in Tabasco Oil Co., which has a contract to explore and produce oil in a field in eastern Colombia.
The acquisition of the YPF stake may be fortunate timing for Slim, said Laurence Balter, who oversees $100 million for Fox Island, Washington-based Oracle Investment Research.
“YPF is worth much more than it is priced today,” Balter said. “Another great value play by Mr. Slim.”
Slim’s only major holding in Argentina is the wireless carrier Claro, a unit of America Movil SAB that has about a third of the nation’s mobile-phone subscribers. The company had sales of 11.9 billion Argentine pesos ($2.6 billion) last year in Argentina, Uruguay and Paraguay combined, according to its fourth-quarter report.
Slim’s net worth has surged 8 percent in 2012 to $66.5 billion, expanding his lead as the world’s richest person, according to the Bloomberg Billionaires Index daily ranking.