YPF secures $1.2 bn in record-low-cost bond to fund Vaca Muerta expansion
Argentine oil producer YPF raised $1.2 bn through a nine-year international bond at a 7.85% effective rate, the lowest in its history, to finance its Vaca Muerta shale program.
YPF completed a nine-year international bond offering that raised $1.2 bn at an effective 7.85% interest rate, the cheapest borrowing the company has achieved. The bonds were priced 300 basis points above U.S. Treasury securities, drawing $2.2 bn of demand from more than 50 investors after meetings in New York. The issuance, the biggest Argentine foreign-currency debt sale in over a decade, will fund the Vaca Muerta shale expansion, prepay two existing bonds due 2027-2029, and lengthen the firm’s debt profile under its Plan 4x4 strategy.
International banks BBVA, Itaú, JPMorgan, Santander and Balanz acted as placement agents, while local firms handled domestic placement. S&P Global Ratings raised its earnings forecasts for YPF but left the rating capped at “B” because of Argentina’s transfer and convertibility risks, noting the company’s low leverage and leading market position as strengths.
Why it matters
The funding lowers YPF’s borrowing costs and supports Argentina’s key unconventional oil project, affecting energy supply and the country’s fiscal outlook.
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