UPDATE 3-Abengoa in Spain requests bankruptcy process after creditors lose patience

* The company voluntarily requests the opening of the bankruptcy process

* Creditors refuse to extend deadline for restructuring negotiations

* Regional government says it is unable to help (updates with bankruptcy application)

MADRID, February 22 (Reuters) – Spanish engineering and renewable energy firm Abengoa said on Monday it decided to voluntarily request to start the bankruptcy process after its creditors refused to extend the deadline for negotiating ‘a restructuring agreement.

A restructuring proposal to tackle Abengoa’s € 6 billion ($ 7.30 billion) mountain of debt has collapsed since Andalusia’s regional government withdrew a 20 billion funding offer. million euros as part of the global agreement.

“The board of directors … remains determined to seek alternatives to avoid the non-viability of the subsidiaries which carry out the activity of the group and, thus, to preserve the jobs and to try to minimize the loss of value”, declared Abengoa in a statement to the Spanish stock market regulator.

The bankruptcy request was presented to a court in Seville on Monday. In its statement, the company said its board of directors decided that this was the most appropriate measure to safeguard the interests of the company and its creditors.

The company said earlier on Monday that “in the absence of renewed consent to the extension of the deadline,” the restructuring agreement was automatically terminated.

Since September, Abengoa has repeatedly postponed the deadline to complete negotiations while seeking alternatives to financing Andalusia, but his creditors appear to be running out of patience.

A regional government spokesperson said Andalusia did not have adequate tools to inject direct aid into the business.

A spokesperson for the Budget Ministry declined to say whether Abengoa could be eligible for assistance from a € 10 billion fund that focuses on bailouts of companies in strategic sectors.

In 2016, Abengoa narrowly avoided becoming Spain’s largest corporate bankruptcy after reaching a deal to refinance € 9 billion in debt, handing control of the company to an assortment of banks and funds. investment.

The Seville-based company, which employs around 13,500 people, had borrowed heavily over the previous decade to fund an aggressive expansion in clean energy through its traditional expertise in the design and construction of infrastructure projects.

At the end of 2019 – the most recent period for which full figures are available – Abengoa’s total debt stood at € 5.95 billion.

After the company reduced its annual losses to 549 million euros in 2019, from nearly 1.5 billion euros in 2018, the COVID-19 pandemic brought new problems, blocking new projects and forcing the business to reconnect with lenders.

Abengoa eventually secured a complex preliminary deal whereby most of its assets would be transferred to a holding company, which in turn would receive 230 million euros in state-guaranteed loans. But it has now collapsed.

Trading in Abengoa shares was suspended for months ($ 1 = 0.8241 euros) (Report by Nathan Allen, Jesús Aguado and Joan Faus edited by Ingrid Melander, David Goodman and Howard Goller)


Source link

About Nathalie Shelton

Check Also

How does Payroll Protection Business Loans make a difference in Camden?

CAMDEN, NJ – For John and Carol Kunkel – owners of the Haddon Heights seafood …

Leave a Reply

Your email address will not be published. Required fields are marked *