YPF/Petersen18 Feb 2021 09:10
The Burford share price may well be held back for quite some time ahead until there is some clarity on the YPF/Petersen case in NY. Judge Preska is reportedly to get the parties together again today in order to finally decide how the discovery phase is to proceed. Sebastián Eskenazi, still heading up the Banco de Santa Cruz in the province of that name which is the fief of the Kirchners and of Alberto Fernandez, the present President of Argentina, has been served with a summons to appear before the judge (not today) and to submit the relevant documentation in his possession. If anyone at all has beans to spill, it would be he since he was presumably aware of all that went on around all the various stages of the privatisation of YPF to Repsol and the Petersen companies set up in Spain, the later expropriation of Repsol's 51% stake, the agreement of compensation to Repsol, the seeming denial of similar compensation to the other shareholders, any side arrangements, etc, etc. Rumoured side arrangements seem to indicate suspicions that the Petersen stake in YPF (acquired at no initial cost, zero, but to be "paid" over time only out of dividends from that same stake!). It is perhaps interesting that both Burford and the Argentine side want him to appear before Judge Preska, in fact it was Burford who served the summons on him at Miami Airport. Now whether that means Burford are seeing him as being "hostile" or whether the Argentines are believing he is on their side, so to speak, I honestly cannot work that out, given the very extensive business interests the Eskenazis still have in Argentina with the inevitable political implications there would almost certainly be. From the Argentine press and media, I sense that they seem to detect or divine some frustration on the part of Judge Preska with Burford for their seemingly having appeared reluctant to voluntarily present Eskenazi to testify, although this may be either wishful thinking or something for public consumption within Argentina. However, the Argentines do seem to feel that there is movement in their favour. They seem, btw, to be now pushing for the case to be heard under Argentine law, even in NY, should the judge rule that the proper jurisdiction is the US. This case still seems likely to drag on and on and on. The market will be fully aware that a loss for Burford may well mean that all the amounts taken to profit in previous years would need to be written back. Whether there would also be contractual implications on profits declared from the previous sales of portions of the case by Burford, no idea. I would expect this whole business to be hanging over the progression of the share price for quite some time ahead, unless there is something extraordinary that happens such as a Reddit-storm or some win by Burford sufficient to overcome the possible negatives from a loss in the YPF case.
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