Vicentin, the agro-export company from the north of Santa Fe and in bankruptcy proceedings for a debt of 1,573 million dollars, presented a draft of the new proposal to be analyzed by the creditors, which includes the sale of its participation in Renova, the largest soybean processor in Argentina and one of the most relevant worldwide.
From the Banco Nación, the company’s main creditor, they advanced that it is “unacceptable”.
Weeks ago, the Judge who carried out the Bankruptcy of Creditors in the Courts of Reconquest in Santa Fe, Dr. Fabián Lorenzini, rejected the initial offer that established a 70% haircut, all dollarized, and payment terms of up to 15 years.
In said proposal, the company intended to pay off the debt first by removing its creditors from the commercial and agricultural sectors, in order to then pay foreign and national banks in 13 consecutive annual installments, with the money produced by the flow of business from contracts to fason that were signed with the three cereal companies that have so far shown interest in being part of the new Vicentin. They are: Viterra, Molinos Agro and the Association of Argentine Cooperatives (ACA).
After the rejection of the Justice of Reconquest, now the company has until March 31 to obtain the approval of the new proposal by the creditors. If that time expires without an understanding with the parties involved in the contest, the company would be heading for bankruptcy. Within the framework of the technical table that was formed with the creditors, Vicentin presented the draft of a proposal, to which Infobae agreed, which in other aspects contemplates an offer to commercial creditors to pay 20% of the polarized debt, in two annual installments: one this year and the other in 2023 .
In this new proposal, Vicentin plans to allocate 270 million dollars that he would obtain from the sale of part of his assets to pay the so-called unsecured credits, which would be dollarized at the exchange rate in force on the day the contest begins (60,778 pesos per dollar). The payments would be made, first with 120 million dollars when the proposal is approved and then with 150 million in a first installment, which will be during 2023.
On the other hand, Vicentin plans to capitalize the balance and convert it into a trust in which the current partners of the Santa Fe company will retain only 10% of the shares. The 90% of the remaining package, in the event that the proposal is approved by the creditors, should be transferred to the creditors and the Strategic Stakeholders for a value of 179 million dollars.
One of the relevant data of the proposal is that For the first time to deal with the debt since Vicentin, they talk about using the money available in cash, and the proceeds from the sale of the company’s shareholding in Renova. In relation to that company, Banco Nación is the main creditor with a debt that it has not been able to collect up to now of 300 million dollars. Vicentin’s offer to the creditors is to cede the remaining shares that remain in that company, which is 33.33 percent.
“Additionally, Vicentin and Banco Nación should advance in the consensus of a plan for the north node, so that the privileged credit of Banco Nación can be repaid with part of the cash flow of the bioethanol business plus certain cash payments with a part of the rest of Vicentin’s income. For this, in addition to the guarantee offered on the North Node, Vicentin could consider offering an additional real guarantee”, it was indicated in reference to the plants installed in the Reconquista and Avellaneda area”, the proposal is recorded.
According to the cash flow of the offer, Vicentin plans to raise some 300 million dollars in two years from the sale of its stake in Renova, and from the advance payment to ACA, Viterra and Molinos Agro for the fazon contracts at the Ricardone and San Lorenzo, two annual installments of 35 million dollars.
To all this we must add about 68 million dollars over 15 years for the ethanol plant, and about 50 million dollars over 15 years for other sales of minor assets and collections. With all this, plus the cash income, the company projects to generate income in 15 years for 750 million dollars, from which it is necessary to deduct the expenses of compensation for the detachment of the business, pay the unsecured creditors, the Afip and other privileged creditors.
Banco Nación’s position: “The proposal is unacceptable and insufficient”
The president of the Bank of the Argentine Nation, Eduardo Hecker, in dialogue with Infobae maintained that Vicentin’s new proposal to creditors “It is unacceptable and insufficient.” “It is far from the possibilities that the Bank will satisfy a proposal of this nature. Part of it is constituted with a promise of payment through the invoicing of a non-certified number of the ethanol plant, which it would produce only to pay Banco Nación. What is presented as not very credible, assured.
In addition, the manager stated thatthis proposal is based on finishing scrapping the Vicentin group, and completely separate what was left of Renova, which is a super modern and productive plant worldwide. And this process is inevitably, also at some point, a process of massive job losses in the region. For the Bank it is not acceptable either as an unsecured creditor or as a privileged creditor. It is nonsense to make a proposal only on ‘the North Node’ or a group of companies, since the credit was allocated to the whole of Vicentin. This is a fundamental point”.
In turn, Hecker said that Vicentin’s write-off of the Bank’s debt is close to 65%. And in this regard, he added: “If I take into account an annual income for 15 years of five million dollars that they would pay for the profits of the bioethanol plant, and apart from that they tell me that all the profits from the ethanol go to Banco Nación. Does it seem serious to you that the proposal of a business group that is only going to produce ethanol to pay Banco Nación?, when we don’t know how much the cut of ethanol in fuels will be in two, three or four years.”
Regarding the decision that Banco Nación would adopt in this new context that the Vicentin company is proposing, the head of the entity pointed out that Banco Nación has a very particular characteristic in this situation, since on the one hand it is a creditor of those who are in Bankruptcy , and on the other hand is a privileged creditor. “There is always the possibility of not accepting the proposal and promoting a process that ends either in the Crown Down or in bankruptcy. This proposal does not represent a good way to avoid bankruptcy, and we have the possibility of exercising the right to ask for that option. We are facing a situation that affects the rights of the Bank and all Argentines. The same ones who carried out a fraud and kept a huge amount of money, are seeing how they continue in this process. We will not accept it,” he said.
And he concluded: “The State has to be part of the solution. I also believe that ACA or Molinos can be part of the solution. Welcome are all those who contribute to the solution and including the other granary creditors. We need to generate a great solution. Not a single problem but a great solution”.