Big Dog's Boom Boom Room Message Board

To: Dennis Roth who wrote (167134)	4/17/2012 12:53:49 AM
From: elmatador	of 179016

Repsol's use of YPF as a cash cow has rankled the government and a partial selloff of the company has not helped matters. In 2008 Repsol sold a minority stake to local investors the Petersen Group, and agreed to pay out 90 percent of YPF's net income as dividends, according to filings with securities regulators. The large pay outs have constrained the amount of new investment YPF can undertake due to its policy of relying mainly on internally-generated cash to fund its capital expenditures. As the biggest player in Argentina's oil and gas sector, YPF's cash and dividend policies had an overwhelming influence over the overall level of investment by the industry. The Argentine government has for months complained about the policy and now appears set on a course of action that would, at least in the short term, boost YPF's capital expenditures. By taking a majority stake in the company the government will be able to dictate dividend policies and direct more cash to investment. reuters.com