Argentina’s US IPO revival stalls as market rout chills debuts

Two Argentine energy companies have put plans for US initial public offerings this year on hold, dealing a blow to hopes of reviving the country’s long-dormant market for New York stock listings as a rout in local assets and global market turmoil dampen investor appetite.

Renewable-energy producer Genneia SA has put its plans for a New York listing on hold until at least 2027 as a sell-off in Argentine assets weighs on its potential valuation, according to people familiar with the matter. Power producer YPF Luz’s planned offering has been shelved after its controlling shareholder agreed to buy out a minority investor whose exit had been a key driver of the IPO.

The setbacks come as Argentine stocks and bonds tumbled in recent months, caught in a broader global retreat from riskier assets and mounting investor anxiety ahead of President Javier Milei‘s re-election bid next year. The benchmark S&P Merval has fallen almost 30 percent in dollar terms from its June high, while sovereign bonds are among the worst performers in emerging markets since September.

“In all likelihood, both IPO processes are suspended given market conditions,” said Ezequiel Fernández, Equity and Credit Research Director at local broker Balanz. “At these multiples, companies would be selling too cheaply for a normalised Argentina scenario – unless we see a strong rebound in stock prices, they’ll likely prefer to wait and see what happens in 2027.”

Argentina has been absent from US equity debuts since 2019, when Vista Energy sold shares. That followed IPOs by Corp America Airport SA and power generator Central Puerto SA the year earlier.

The divide

The delays highlight a growing divide in Argentina’s capital markets. Energy companies have raised billions of dollars through international bond sales to finance expansion, yet the boom has failed to revive equity offerings as falling share prices make prospective listings less attractive to their owners.

Power provider Genneia had advanced significantly with preparations for its offering before putting the process into wait-and-see mode, according to people familiar with the deal. The renewable-energy producer filed with US regulators in July for a listing in New York and Buenos Aires and lined up Morgan Stanley and BTG Pactual as global coordinators.

In the Milei era, Genneia has won energy storage contracts on the grid, jointly acquired a stake in Argentina’s biggest electricity-line company, and in the second quarter saw its Ebitda jump by 17 percent from the same period last year as new solar facilities came online.

YPF Luz’s plans took a different turn after a company controlled by a General Electric C. spin-off, which owned roughly 25 percent of the electricity producer, opted to exit through a private sale rather than a public offering. Controlling shareholder YPF SA agreed to acquire the stake for US$430 million, effectively sidelining the IPO process for now.

The offering had been conceived as a vehicle for the GE spin-off to exit its investment, according to a person with direct knowledge of the plans. With that objective now achieved through the private sale, a listing is unlikely in the near term, the person said. The transaction doesn’t preclude YPF from eventually pursuing an offering of the business.

Both companies declined requests to comment.

Backdrop

The stalled listings reflect a sharp deterioration in sentiment toward Argentine assets after a strong start to the year. Rising US Treasury yields and a broader global risk-off shift have compounded concerns over Argentina’s economic outlook and political uncertainty ahead of the 2027 presidential election.

The economy is likely to have slipped into recession in the third quarter, even as energy remains one of its fastest-growing sectors. Shale oil exports have surged and the industry has attracted tens of billions of dollars in announced investment, while manufacturing, construction and other labour-intensive sectors have struggled.

That divergence has also played out in capital markets. Stronger Argentine companies, particularly in the energy industry, have continued to access international debt financing despite recent volatility. Genneia itself is targeting a green bond sale this week.

Equity investors have proved far harder to attract. The slump in Argentine shares has depressed valuations, leaving prospective issuers reluctant to sell stakes at these prices.

Even a retreat in US Treasury yields from recent highs of around 5.3 percent has failed to provide relief for Argentine equities, underscoring how deeply investor sentiment toward the country has deteriorated.

“For now, Argentina is in the penalty box,” said Walter Stoeppelwerth, chief investment officer at Grit Capital Group. “US yields go down and Argentine stocks keep selling off – that’s a technical reality. There are no buyers for the Merval today, so I don’t see room for an IPO right now.”