Sunday, May 26, 2024

The Battle For Abengoa Focuses On The Control Of Assets

The approval of Abengoa’s restructuring plan was left up in the air after the resignation of the board of directors. Now, Gonzalo Urquijo and his team are negotiating with Abengoashares , the minority that fired them, a strategy to carry out the rescue.

Conversations flow, as reported to sources familiar with the negotiations, and recent agreements, postponement of the judicial confrontation and acceptance of new candidates for the board, are a sign of the approach.

Although the latest news about the company is only the tip of the iceberg and underwater the biggest differences appear and where the meetings are centered.

Minorities request a new assessment of the financial situation of the company and the assets that compose it, considering that Covid-19 , an argument that the company used to request a rescue and calibrate the status of the group, is not valid.

The fact is that in order to clean up the accounts, Abengoa has had a divestment plan since 2016 with which to pay suppliers and creditors .

Since its inception and until last year, it allocated 870 million euros from the sale of Atlantica Yield to repay one of its debt issues, New Money.

According to the information provided by the company, Abengoa has in its portfolio 12 assets from which it can obtain returns and these are included in the rescue plan to amortize the support of creditors or make payments in payment to suppliers.

The assets are spread over Spain , the United States , India , Latin America and Africa . These include plants in Algeria , Ghana , India and Mexico .

On the other hand, they are pending collections or litigation in Spain , Kenya , the United States or Poland and awaiting government approvals in countries such as Peru .

The company insists that just by winning the international arbitrations it has open it can pocket more than 1,000 million euros, which would be a real boost for the viability of the multinational.

Abengoashares requests a new audit
This plan is not enough for minority shareholders and they insist on having access to the audit carried out by KPMG to know the status of the accounts. To date, the company has withheld this report on the grounds of confidentiality.

Abengoashares also requests another audit for the 2019 accounts, which are not submitted to the National Securities Market Commission ( CNMV ) with the signature of a consultant.

In this sense, Marcos de Quinto , the candidate of small investors for the presidency of Abengoa, pointed out in an interview with that the Sevillian hides information regarding the status of the group.

Despite this statement, De Quinto shows a conciliatory attitude with Urquijo, another example of smoothing the rough edges between both positions and the objective, according to the former executive vice president of Coca Cola Company , is to speed up the signing of an agreement as much as possible.

Even, he pointed out to, they would be willing to renounce part of their requests in order to achieve an agreement that is as favorable as possible for all parties.

Of course, the objectives of increasing Abengoa’s position in Abenewco 1 and that the current parent continues to command the future of the group seem, for the moment, the red lines of the negotiation.

And it is that it will be in the control of the subsidiaries where the control of the group will reside. The desire of Abengoashares is that the advice of Abengoa and Abenewco 1 be the same .

Urquijo’s dismissal did not mean that he and his council also left the management of Abenewco 1, the recipient of the rescue, and therefore, the one that currently brings together the group’s activity, since Abengoa has been emptied of activity.

By preventing a new board from voting at the extraordinary meeting, the company managed to get the incoming team to convene a universal meeting for Abenewco 1 and resolve this situation.

To date, Abengoa maintains a position of 77.25% in Abenewco 1, so De Quinto’s triumph would have allowed him to also take over the position in Abenewco to command a new negotiation with suppliers, creditors, banks, ICO , etc. Cesce and the Junta de Andalucía .

But now we have to wait for the extraordinary meeting in December to appoint a new board in the old Abengoa. With this assembly, Urquijo intended to close the role of the Sevillian in the new group with three independent directors .

Now, the minority have proposed their own, as a previous step to the appointment of De Quinto and subsequent call for a universal meeting.

As the power play continues, the company’s bailout remains unsigned. Billions are in the air and the injection of up to 250 million from the ICO from the IBEX 35 bank , except for Sabadell , plus Credit Agricole and 300 million guarantees from Cesce are not signed.

A pact that could be blown up if retailers succeed and take root in the need for Abengoa to continue as the predominant company and the one listed on Abenewco 1.

And, according to the company, the signatories of the viability plan would only accept the agreement that is already over the week and that they will be inflexible in the face of an increase in the position of what would be the old matrix.

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