Litigation funder Burford Capital has asked US District Judge Loretta Preska for permission to explore the possibility of pursuing Argentine government assets, including potentially, those belonging to state-owned Aerolíneas Argentinas (AR, Buenos Aires Jorge Newbery), as part of Petersen Energia Inversora and Eton Park Fund's cases against the Republic of Argentina and its oil and gas concern, Yacimientos Petroliferos Fiscales (YPF).

According to the Financial Times, the plaintiffs want to examine large swaths of Argentina’s state-owned assets, including the flag carrier. According to Bloomberg, Burford argues that YPF, as a state-owned petro outfit, is essentially an alter ego of the government.

Last year, the United States District Court for the Southern District of New York agreed on a judgement against Argentina of approximately USD16 billion derived from the partial nationalisation of YPF in 2012. Judge Preska said that event violated YPF by-laws requiring the company to make a tender offer to all shareholders. Burford Capital has been pursuing the case since 2015.

Petersen Energia Inversora was awarded a tender offer consideration of approximately USD7.5 billion and Eton Park of USD900 million before interest. The judge’s calculations also set interest of approximately USD6.8 billion for Petersen and USD815 millon for Eton Park, yielding a total judgement of USD14.3 billion and USD1.7 billion, each, or USD16 billion in total, Burford reported last year in a notice to its shareholders.

However, Burford Capital has been unsuccessful in collecting the massive award from the Argentine government. Earlier this year, it requested Judge Reska to order Argentina to transfer its 51% stake in YPF through a custodial account at Bank of New York Mellon. This 51% stake would have been worth about USD4 billion, or about a quarter of the judgement, when Burford filed its motion in April 2024. It is now pursuing a new strategy following recent public comments by Buenos Aires province governor Axel Kicillof, who said that YPF’s directors are officials of President Javier Milei.

Aerolíneas Argentinas declined to comment on the matter.

The Javier Milei-led government attempted to privatise Aerolíneas Argentinas earlier this year as part of its economic shock therapy to improve the country’s anaemic finances. However, the move and others were struck off the published version of the Ley de Bases (Base Law), an omnibus bill crucial to the current administration.

ch-aviation has reached out to Burford Capital for comment.