U.S. Judge Says Argentina Owes About $16 Billion After YPF Payout Trial

Argentina suffered a big legal defeat on Friday as a U.S. judge ruled that the country must pay about $16 billion to minority shareholders of YPF arising from the government’s 2012 seizure of a majority stake in the oil and gas company, Reuters reported. U.S. District Judge Loretta Preska in Manhattan ruled in favor of Burford Capital, which funded the litigation brought by shareholders Petersen Energia Inversora and Eton Park Capital Management LP, and according to court papers was entitled to a respective 70% and 75% of their damages. The payout includes the approximately $8.4 billion of damages Burford sought plus about $7.6 billion of 8% prejudgment interest running from May 3, 2012, about 2-1/2 weeks after the seizure. Burford called the decision “a complete win.” Its shares closed up 22% in London and rose as much as 28% in intraday trading in New York. Argentina, which is in dire financial straits including a scarcity of foreign exchange reserves, had sought to pay no more than $4.92 billion, saying a big payout “would further burden a sovereign nation with a populace enduring pressing economic challenges and would far exceed Argentina’s budget for many critical services.” Preska had previously ruled that Argentina had breached its obligations to the shareholders by seizing the 51% YPF stake held by Repsol without tendering for the remaining shares, including those held by Petersen and Eton Park. Read more.