Mason Capital Management LLC is no longer YPF SA’s second-largest minority shareholder after reducing its position, according to two people with knowledge of the transactions.
Mason, which held a $431 million stake at the end of March equal to about 4 percent of the shares, told YPF that its holdings have fallen below the 3 percent threshold that allows the hedge fund to act as an adviser, said the people, who asked not to be identified because the transactions haven’t been made public. Both Mason and YPF spokesmen declined to comment in e-mailed statements.
Mason’s move comes after regulatory filings over the past year showed hedge fund managers George Soros, Dan Loeb and Richard Perry all cut or divested their stakes in YPF amid a global rout in oil prices. While the crude producer’s American depositary receipts have dropped 26 percent from a year ago, they’ve almost doubled since Mason started building its position in the second quarter of 2012, when the company was expropriated by the Argentine government. The hedge fund’s position has since grown sixfold in market capitalization.
YPF has become a widely held security among hedge funds betting on an investment boom once Argentina settles with creditors from its 2001 default. The oil producer was among the top three positions for investors including Brevan Howard Asset Management, Knighthead Capital Management and Redwood Capital Management, according to first-quarter filings.
Argentina is banned by U.S. courts from paying its overseas bonds until the country compensates its holdouts from 2001, led by Elliott Management. Optimism that Argentina will soon end the impasse and lure money from abroad began to fade over the past three months as the front-runner for October’s presidential elections more closely aligned himself with President Cristina Fernandez de Kirchner’s stance against creditors.
Lazard Ltd. is YPF’s largest minority stakeholder with a collective 4.1 percent holding in the company. The Argentine government and 10 provinces hold a 51 percent stake.