GE snaps up 25% of YPF electric division

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Thursday, February 8, 2018

Argentine state oil company YPF has agreed to sell 24.99% of its electric energy division to GE, and use the proceeds to finance expansion into the generation segment.

YPF entered into an agreement with EFS Global Energy and GE Capital Global Energy Investments, both indirectly controlled by GE Energy Financial Services, for the capitalization of YPF Energía Eléctrica.

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In the acquisition, first announced in December, GE will pay US$227mn for a 24.99% stake in YPF EE shares, plus a contingent payment of up to US$35mn. The subscription deadline is February 28, and once subscribed GE and YPF will jointly control YPF EE.

YPF also advanced in talks with a potential third partner to open up the possibility to subscribe an additional 24.5% of YPF EE shares, on terms similar to those agreed with GE, a company statement said.

YPF aims to use this capital to continue increasing its generation capacity with an estimated total investment of US$1.3bn.

Currently YPF EE has net generation capacity of 1.69GW, with 485MW of projects under construction.

Lazard acted as financial advisor to YPF in the deal.