YPF Avoids Hard Default With 60% Support for Key Bond Swap

Argentina’s state-owned oil producer looks set to avoid a hard default after creditors signed on to swap some of their bonds due next month and the central bank agreed to provide the company with the dollars it needs to pay back the remainder, Bloomberg News reported. YPF SA bondholders will exchange almost 60% of the $413 million note due in March, according to a company statement. Argentina’s flagship energy company also won support from 43% of creditors to exchange its 2024 notes, and 37% of holders of one of its securities maturing in 2025 to exchange their holdings for a menu of three new bonds. The moves will generate about $630 million of debt relief for YPF through 2022, according to people at the company with knowledge of the matter. The oil producer aimed to restructure as much as $6.2 billion in debt payments -- exchanges that ratings agencies say would be tantamount to default -- to free up money to invest in the shale-rich region of Vaca Muerta in Patagonia. “YPF was able to avoid the much feared default and get the sufficient amount to issue the three proposed notes,” said Lorena Reich, a corporate analyst at Lucror Analytics in Buenos Aires. “Now, the company needs to gain investors’ trust again and manage to grow on a relatively tight budget.” YPF notes climb back after investors panned company's first debt offer in Jan. YPF’s bonds due in March climbed 2.7 cents to 97.2 cents on the dollar, while securities due in 2024 jumped 4.6 cents to 85.5 cents on the dollar. Read more.

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