The appointment of Pablo González as president of YPF is interpreted as a confirmation of the power of Cristina Fernández de Kirchner and La Cámpora Inside the company. It is considered completely aligned with the ideas of the vice president and her references. But as soon as the designation was produced, a message reached the CEO, Sergio Afrontti, put there by Miguel Galuccio. They gave him to understand that one thing is the operational management of the company and another, the political management.
The representation of La Cámpora within the company is manifested in Santiago “Patucho” Alvarez, in charge of Corporate Affairs, Marketing & Communication, and Santiago Carreras, who was in charge of sports sponsors, especially football.
In La Cámpora they repeat that they respect Affronti. However, they do not look at Miguel Galuccio with that sympathy, the former president of YPF who suggested Affronti for that position, as part of a shortlist. Galuccio -now the main shareholder of the oil company Vista- He proposed three names to the vice president, who ended up selecting Affronti.
Galuccio is one of the few entrepreneurs who has access to Cristina’s ear Kirchner. That link causes some noise in La Cámpora.
On Thursday the version of a nationalization of the remaining 49% of the company. In YPF they denied it immediately. The next day, Minister Martín Guzmán was in charge of denying that possibility, something that was celebrated at the oil company. Galuccio, who collaborated with Guzmán on the sovereign debt restructuring proposal and in meetings with businessmen, also He asked the minister for a gesture friendly to the markets.
“All we want is for Affronti’s management to be a success,” they point out from La Cámpora. Of course they reserved the handling of a substantial part of the cash of an oil company that invoices US $ 10 billion a year.
González’s appearance is greeted by the most political wing. “He comes from Santa Cruz, from an oil province, knows about unions and knows about government,” they emphasize from there. They are all conditions that award it to lack the outgoing Guillermo Nielsen.
YPF decided to increase its prices by 34% from August until now. From December 2019 to August 2020, he had them frozen. Affronti and his team were drivers of these recompositions. The most political officials are always averse to price increases, because they are unpopular.
Everything indicates that there one of the probable tensions surfaces. With the devaluation and the price of Brent oil (the benchmark) on the rise, the industry would tend to believe that this would lead to a price recomposition. However, the political wing is more reluctant to that possibility, especially when it is heading towards an election year.
One of the keys to Miguel Galuccio’s management, which started with nationalization and ended with the change of government, was that he was able to increase prices, which allowed him to generate enough cash to make investments. That is the future doubt that the market has about the behavior of the oil company towards 2020.
YPF’s financial debt before its expropriation (for example, at the end of 2011) amounted to US $ 2,588 million. Four years, that same liability amounted to US $ 6,895 million. According to an analyst who advised the previous management, the administration had about $ 7.8 billion of financial debt at the end of the first half. According to this analysis, the velocity of liabilities during 2016 and 2019 grew much less than in the 2012-2015 period.
The other oil companies understand that a price freeze by YPF it would affect them all, since none could mend. Doing so would mean being left out of the market, as consumers would seek the cheapest price. YPF already has a 55% stake.
In the companies they also believe that the management team that accompanies Affronti may be more or less experienced, but that they are knowledgeable about the industry and companies, so they will not turn towards a very directed measure.
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source https://pledgetimes.com/the-intern-that-has-already-started-at-ypf-la-campora-vs-the-ceo-of-the-oil-company/
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