Argentina’s largest oil and natural gas producers, Compagnie General de Convertibles, Vista Energy and YPF, announced this week that they will be closing on a deal by Pampa Energia that will lead to lower interest rates due to strong demand from investors. The company plans to sell the bonds in the local market. US dollar-denominated securities.
Pampa last week issued $84 million worth of four-year bonds at a price of 5.75%. Although the amount raised fell short of the deal’s $100 million cap, it exceeded the $50 million minimum, a sign of strong demand from investors after the first month of tax amnesty.
The government is allowing people to declare $100,000 without penalty under the amnesty, with the added benefit of wiping out previous tax avoidance.
Thanks to the amnesty, the country’s foreign exchange reserves reached $29.2 billion on Thursday, up from a recent low of $26.9 billion in mid-September and the highest level since July, central bank data showed.
At the same time, the government has refrained from selling bonds to recoup amnesty dollars, a boon for private borrowers.
Economy Minister Luis Caputo said on Thursday: “We want these dollars to be channeled into the private sector so that the capital markets can develop and allow for more investment and the creation of quality jobs. ” he said. “The purpose of amnesty is not to collect” money, but to reinvigorate the economy and private investment. ”
low yield
Caputo said Pampa’s bond sale is one example. The 5.75% interest rate achieved in the deal is “even lower than the rates available in the external market,” he said. “This is exactly what we want.”
Pampa raised $410 million in international markets in September by selling 2031 bonds with a yield of 8.25% to refinance 7.5% bonds due in 2027.
Next to enter the market is state-run energy company YPF. The company plans to raise $150 million from Monday’s sale of four-year dollar-denominated notes, with an initial offering price of $100 million and the proceeds to be used for investments, debt refinancing and operations, according to a securities filing. The money will be used for funding.
On Tuesday, Vista Energy started its offer at $75 million, aiming to raise up to $150 million through the sale of seven-year dollar notes, while CGC began offering up to $70 million in three-year dollar notes. It is expected to start at $30 million. .
