It is worth remembering that this Monday, YPF failed to make progress on its first attempt to start debt restructuring, al not bringing creditors together in different international assemblies to deal with a refinancing of payments.
The company He had planned yesterday to hold seven assemblies, where he would discuss with his creditors the restructuring, but communicated to the Buenos Aires Stock Exchange that he could not specify them. “Due to the lack of the necessary quorum to hold meetings, it was not possible to open the act in the first call and hold it,” the company reported.
In the early hours of this Tuesday, January 26, it transpired that the company “improved” some of the conditions proposals initially in their attempt to bring positions closer to their creditors. Among these modifications, it stands out that it extends the final expiration of the offer on February 5These new conditions are valid for those investors who have already entered their bonds for the exchange as well as for all those who wish to do so until the final expiration date.
How is the new YPF offer
As it was learned, the modifications mainly “seek to strengthen the guarantee structure of the bond backed with export flow maturing in 2026 and address investor concerns about the non-existence of flows during the next two years“, they commented.
In this regard, the company decided to strengthen the guarantee structure of the 2026 bond through the offering of a first-degree pledge over shares of its subsidiary YPF Luz, one of the largest developers and operators of renewable and thermal power generation plants in the country.
Regarding the flow of interest, “during the next few years, the company incorporated the payment of coupons in the three new bonds at rates of 4% for 2026, 2.5% for 2029 and 1.5% for 2033 “, sources close to the case detailed.
In addition, to increase the economic value of the exchange proposal, the company increased the interest rate on the new 2026 and 2029 bonds from 8.5% to 9%, applicable from January 2023. On the other hand, it also modified the amortization structures of the new 2026 and 2029 bonds to shorten the average life, among others.
It is worth remembering that these changes are added to the one already introduced on January 14, by which the company modified the characteristics of the majorities necessary to proceed with the change of the non-economic terms and conditions of the old bonds, going on to require an absolute majority of holders of each series.
The company indicates that the changes adopted for the improved exchange proposal reflect the company’s vision in terms of “to its dialogue with the market, having responded to most of the concerns raised by investors, within the possibilities that the company has due to the difficult financial situation that it has to go through as a result of the impacts generated by the pandemic that aggravated a situation of decline in gas and oil production that the company dragged from previous years “.
When will be the second call for the meeting of bondholders
In the framework of the process of refinancing its debt, and the modifications that YPF presented to its exchange proposal, it was reported that the date for the bondholders’ meeting, in second call, will be held on February 11.
Parallel, the company decided to present the guidelines of the investment plan 2021 approved by the company’s board of directors, taking into account that one of the objectives of this debt refinancing is to allocate funds to increase investments to reverse the decline in oil and gas production in recent years.
As it transpired, depending on the availability of cash, the oil company foresees an investment growth for this year of 73% compared to 2020.
“Investments in the Upstream would grow more than 90%, which would allow to stabilize, and tend to increase, the production of gas and oil despite the declines inherent in the fields operated by the company”, indicated sources close to the case.