Editorial Details

Editorial

28 Feb 2013 Repsol sale of LNG Assets to Shell

Repsol sale of LNG Assets to Shell - following the nationalisation of YPF by the Argentine government, Repsol has been seeking to maintain its credit rating (currently BBB- at Fitch) via a disposal and debt reduction programme. The sale of LNG assets in Peru, Spain and Trinidad & Tobago has resulted in disposal proceeds of approximately EUR2.7bn. Repsol has stated that the deal will reduce net debt to EUR2.2bn. In a press release yesterday, Fitch Ratings noted that any rating action would only follow the actual completion of the deal (which is subject to regulatory approvals and conditions precedent) and actual receipt of proceeds. However, Fitch confirmed that the Outlook is likely to be moved to Positive upon completion of the disposal and moreover that the ratings will be upgraded to BBB if the disposal proceeds are fully utilised for debt reduction. This will give Repsol some breathing space and a two notch differential from non-investment grade or "junk" territory. (Linklaters advised the Seller).

Financial Centre : Madrid
Law Firm : Linklaters
Lawyer : Alejandro Ortiz

Practice Area : Infrastructure and Project Finance
Classification : Transfer of Project Assets
Sub-classification : Oil & Gas Assets
Industry : Oil & Gas Producers

Advised Party : Seller
Value : 5000.01-10000.00

Assets Jurisdiction : Peru, Spain, Trinidad & Tobago
Purchaser Jurisdiction : United Kingdom