Pescanova's plant in Chapela, Redondela. (Photo: Hombredojalata)

Pescanova’s creditor banks assess not supporting Damm’s proposal

SPAIN
Thursday, March 13, 2014, 01:30 (GMT + 9)

Creditor banks of the Galician multinational firm are assessing the possibility of being away from the initiative presented by the consortium made up of Luxempart and Damm to revive Pescanova.

KPMG consulting firm, hired as a consultant in the refinancing process of the fishing company, explained the six major creditors -- Sabadell, Popular, Novagalicia, CaixaBank, Bankia and BBVA -- the proposed creditors’ agreement issued by the consortium.

This group of banks, known as G7, concentrates over EUR 900 million of the debt of the Galician multinational firm, the agency Reuters reported.

While the proposal led by Damm had been agreed with the banks, now it has caused "somewhat annoyance," as it was reported by sources close to the negotiations. "It has not been approved at all," since in that plan, all the conditions that had been agreed between the two parties are not included, they added.

The newspaper La Voz de Galicia reported that these sources explained that in the agreement presented, "the funds keep a more favourable priority order (preferably in the payment)."

Therefore, it was expressed they will not support the proposal until it is written in a way everyone agrees.

Creditor banks assigned a thorough study to KPMG auditing agency to see the extent until which some improvement can be introduced.

It is expected that in the coming days the auditing firm meets again with these banks and that they take a decision.

Damm’s offer, which was unanimously selected by Pescanova’s board, proposes the provision of EUR 150 million and discounts of between 60 per cent and 90 per cent from the debt.

In addition, out of the funds provided, EUR 37.5 million will be new capital and EUR 112.5 million will be debt up to seven years with an interest rate of 15 per cent annually.

The deadline for accession to the agreement concludes on 3 April. If banks do not join the consortium's proposal, the fishing multinational firm will face liquidation.

The viability plan issued by Damm includes losses until 2017: from EUR 13 million in 2015 to EUR 1 million in 2016.

Related article:

- New Pescanova is waiting for creditors and court’s 'green light'

By Analia Murias
[email protected]
www.seafood.media

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