This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The Deal: Repsol Enlists Outside Arbitrator for YPF Payout Talks

NEW YORK ( TheStreet) -- Spanish oil producer Repsol SA has asked for an independent arbitrator to mediate compensation talks with the Argentine government because of concerns that an offer of $5 billion of government bonds could leave the Madrid-based company shortchanged.

The unnamed arbitrator, described as an international bank, was inserted into the talks by Repsol's board at the last minute on Wednesday as a condition of negotiating with the Argentine government over compensation for the seizure of Repsol's 51% stake in YPF SA  (YPF - Get Report) last year.

Repsol wants the bank to assess the liquidity and ascertain the real value of $5 billion of 10-year government bonds offered by Argentina. The dollar-denominated bonds will pay a coupon of about 8.5%, according to a source with knowledge of the situation.

"The value of the bonds is not their face value -- that is clear to everyone," said the source. "The Argentine government has been a recalcitrant partner in arriving at these negotiations and Repsol wants to make sure that everybody knows exactly the value of what is on the table."

Argentine officials on Monday accepted a proposal based on a Repsol heads of agreement that included the payment of $5 billion of cash as the basis for compensation talks. Repsol had tabled the offer months ago, according to the source, but it was accepted only after it was presented by Spanish government representatives and after Argentina had replaced the cash payment with the bonds.

Repsol's board late Wednesday approved entering talks with Argentina, despite concerns over the real value of the bonds on offer.

"With the aim of developing this heads of agreement, Repsol has decided to start in due course conversations between its teams and those of the Argentinian government, with the objective of finding a fair, effective and quick solution of the controversy," the company said. "The board of directors has approved the engagement of an international renowned investment bank to support Repsol's team and to facilitate a professional management of the process."

Repsol declined to name the bank.
 

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
YPF $20.64 0.00%
AAPL $107.72 0.00%
FB $87.23 0.00%
GOOG $597.79 0.00%
TSLA $238.63 0.00%

Markets

Chart of I:DJI
DOW 16,058.35 -469.68 -2.84%
S&P 500 1,913.85 -58.33 -2.96%
NASDAQ 4,636.1050 -140.4030 -2.94%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs