LATAM WRAP-Pacific Exploration bonds outperform in weak markets
By Paul Kilby
NEW YORK, Sept 1 (IFR) - Bonds issued by E&P company Pacific Exploration - formerly known as Pacific Rubiales - outperformed on Tuesday despite a selloff in broader markets that was prompted by data pointing to a weakening Chinese economy.
The company's 2025s have rallied about seven points since Friday to hit 55.00 after commodity trader Trafigura announced on Monday it had upped its stake in the company to around 10%.
Trafigura's move led to speculation that Mexican conglomerate Alfa may take a more aggressive role in the company's management or up its stake after shelving a C$6.50 per share bid in July.
Venezuela investment firm O'Hara Administration had opposed Alfa's bid, but the two parties appear to be striking a more conciliatory tone following Trafigura's purchase of 2.2m shares at an average - and lower price - of C$4.42 each.
Alfa owns about 19% of the Pacific Exploration, while O'Hara now controls about 20% of the company.
The company announced today that it had agreed to nominate representatives from Alfa and O'Hara Administration as board members.
"It seems like everyone is happy and shareholders are working together," said an investor.
The buyside is cheering the company's expansion beyond Colombia, where the contract for its single most valuable asset - the Rubiales fields - is set to expire in 2016. The company announced today that it has been awarded a two-year contract to operate an oil block in Peru. Continuación...