Moody’s changes Petrobras Argentina to developing

Moody's Investors Service said it affirmed Petrobras Argentina SA's corporate family rating and the rating on its $500 million in senior unsecured notes.

The outlook was changed to developing from negative.

Moody’s said the action reflects the completion of the acquisition of Petrobras Argentina by Pampa Energia SA (unrated) and the ongoing proposed merger into the later.

The change in outlook to developing reflects uncertainties regarding Petrobras Argentina’s capital structure once the merger process with Pampa is finalized. The capital structure of the new company is still dependent on the results of the offer extended to Petrobras Argentina’s minority shareholders to exchange Petrobras Argentina’s shares for a cash payment or Pampa's shares, the agency explained.

The offer expires on Nov. 14. If minority shareholders were to choose the cash option, Pampa would need to raise up to $450 million in additional debt.

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