Repsol SA sued Bank of New York Mellon Corp. for more than $50 million for failing to carry out voting instructions in the election of the board of YPF SA, Argentina’s largest oil company.
Argentina seized 51 percent of YPF in April from Repsol, Spain’s largest oil producer, 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. YPF in June appointed a 17-member board, with Repsol representative Luis Garcia del Rio as the sole minority-stakeholder member.
Repsol alleged that Bank of New York Mellon, as depositary of YPF’s American depositary shares, refused to carry out the voting instructions because they were received after the bank’s deadline. As a result, Madrid-based Repsol was prevented from exercising its right to appoint three directors and two alternate directors to the board, according to the complaint, which also named YPF as a defendant.
“BNY’s refusal and failure to carry out Repsol’s indisputably timely voting instructions and to vote the pledged ADSs at the YPF shareholders meeting held on June 4, 2012, was based on BNY’s own internal failure of communication and the improper interference of YPF in disallowing Repsol’s instructions,” Repsol said in the complaint filed today in New York State Supreme Court in Manhattan.
Ron Gruendl, a spokesman for Bank of New York Mellon, declined to comment on the lawsuit. Two representatives of YPF declined to comment or give their names.
Repsol sued Argentina in Manhattan federal court in May, saying the South American country has attempted to walk away from contractual obligations it undertook when it chose to come to the U.S. to raise capital through an initial public offering of YPF.
Repsol still owns a 12 percent stake in YPF, making it the second-biggest stakeholder behind the Argentinian government.
Repsol also filed an arbitration request at the World Bank’s International Centre for Settlement of Investment Disputes over the seizure of YPF, Julio De Vido, Argentina’s planning minister, said in an interview with Venezuelan state television in May. The case is Repsol SA v. Bank of New York Mellon, 652653/2012, New York State Supreme Court (Manhattan).