(Adds Fitch comment)
BUENOS AIRES, July 2 (Reuters) - Argentine state energy giant YPF on Thursday that it was seeking a swap deal on $1 billion of international bonds to push back payments currently due in March 2021, a move which comes as the sector has been hit hard by the coronavirus pandemic.
The company said in a statement that it would offer a swap that included a cash payment along with new instruments maturing in 2025. The new bonds would maintain the current coupon of 8.5% with amortization payments starting in 2022, it added.
“YPF is actively looking for competitive alternatives as part of its financial plan for the year, which includes, among other things, the possibility of extending the maturity of this new series to improve its debt profile,” it said.
The proposed swap, which avoids a haircut on the debt, comes as the South American country’s government races to restructure around $65 billion in foreign bonds that have become unsustainable after two straight years of economic recession.
Fitch Ratings, which assigned a “CCC”/”RR4” rating to the proposed new 2025 bond, said that the decision reflected the agency’s view “that the transaction does not constitute a substantial reduction in original terms.”
Argentina’s oil industry was severely affected by the coronavirus pandemic, which sparked a historic drop in the price of oil and gas worldwide, while a fall in consumption has led to increased inventories. (Reporting by Eliana Raszewski; Writing by Adam Jourdan; Editing by Jonathan Oatis)
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