Argentine President Cristina Fernandez de Kirchner seized control of YPF (YPF) SA, the nation’s largest crude producer, ousting Spanish owner Repsol YPF SA (YPFD) after a dispute over slumping oil output and investments.
Argentina took over management of YPF with immediate effect, replacing Chief Executive Officer Sebastian Eskenazi with Planning Minister Julio De Vido, Fernandez said today in a speech in Buenos Aires. The government will also send a bill to Congress to take a 51 percent stake in YPF, she said.
The takeover follows more than two months of increasing government pressure on YPF after fuel imports doubled to $9.4 billion last year. The country sought to block YPF dividends and backed provincial governments when they revoked 15 oil field licenses. Fernandez also seized a $24 billion pension fund and airline Aerolineas Argentinas SA since taking office in 2007.
“They are going to be closing the country as an investment destination,” Anish Kapadia, an analyst at Tudor Pickering Holt & Co. in London, said today in a telephone interview from the city. “What’s surprising is that they are expropriating assets rather than going through a fair market means to get hold of a stake in the company. That sets a terrible precedent.”