Pampa Energia debt shelf sparks M&A talk
By Paul Kilby
NEW YORK, Jan 26 (IFR) - Pampa Energia's shareholders have approved a US$500m debt program, raising speculation that the Argentine utility is accumulating a war chest for an acquisition of Petrobras assets.
Pampa CEO Marcelo Mindlin has expressed an interest in buying the Brazilian oil company's Argentine assets.
And local press reported the company had been analyzing an offer for a stake of slightly more than 60% for US$1bn-US$1.3bn.
"They were bidding for Petrobras assets, so you can assume there is an acquisition finance behind that (debt shelf) and possibly a bond take-out," said a DCM banker focused on Argentina.
Analysts at Raymond James wrote last month that acquiring an up to 67% stake in Petrobras Argentina could be financed through debt and the sale of assets, given the credit's low leverage.
As of the third quarter last year, the company had a net debt to Ebitda ratio of just 0.1 times, which would jump to around 1.3 times if it bought 67% of Petrobras in the US$1bn-US$1.3bn range, the analysts said.
Pampa is the country's largest electricity company and is expected to benefit from the eventual lifting of utility tariffs as newly installed President Mauricio Macri looks to establish more market-friendly policies.
Changes to the existing tariff structure are expected to be announced as soon as February, as part of the government's effort to cut the growing fiscal deficit. Continuación...