the judge rules in favor of the funds against the family

the judge rules in favor of the funds against the family

2023-09-04 12:56:50

BarcelonaThe series about the future of Celsa and its ownership has already been resolved: the Mercantile Court 2 of Barcelona has ruled in favor of the creditors and against what the Rubiralta family defended, so that the foreign funds now become shareholders of the company replacing the current owners. The resolution does not allow an appeal and in this way the family loses control of what in 2021 was the fourth company in Catalonia in turnover.

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This is contained in a sentence published this Monday, to which the ARA has had access. The magistrate approved the restructuring plan presented by the creditors, who had been accumulating a billion-dollar debt for years. Formed by six companies and with nearly 12,000 workers, the Celsa group had a turnover of 6,084 million euros in 2022.

For the magistrate, the plan is the only viable medium-term alternative for the entire group, but he also warns the new owners that they will have to strictly fulfill their commitments, preserving and increasing the value of the company, maintaining its integrity , preserving jobs. All this, the text states, without altering the strategic decision-making centers that “have so much relevance for the economy as a whole”.

The capitalization of Celsa

The key was to decide whether or not the current value of the company is greater than the debt that Celsa had contracted over the years, around 3,000 million euros, and that for some years had been in the hands of ‘a series of foreign funds that bought it from banks. Creditors who filed this plan include Deutsche Bank, Sculptor, Golden Tree, Cross Ocean, SVP, Golden Street Asset and London Branch, among others.

In this sense, the judge has endorsed what the creditors defended: Celsa’s valuation does not cover the company’s debt, which is why the funds asked to seize 100% of this industrial company in exchange for part of the debt, about 1,300 million. During the legal process, the parties played a role in a battle over the capitalization of the company: the family presented two reports – through Lazard and BDO and validated by PWC – that valued it at around 6,000 million euros and above the 4,400, respectively. At the same time, a report by the independent expert Lexaudit and Grant Thornton and another by Deloitte commissioned by the funds put its value at no more than 2,851 million.

Oversized figures

The magistrate has criticized the Lazard and BDO reports for having exaggerated forecasts and being based on the hypothesis that the current upward trend in the activity cycle will be prolonged longer than the cyclical nature of the business, which “operates in a scenario of uncertainty with high volatility.”

“The data […] they do not correspond to the historical behavior of the group, nor to the forecasts of market analysts,” reads the text, which refers to the most significant sectors of Celsa’s business, such as construction and automotive. “The reports issued by Lazard and BDO greatly overestimate the value of the Celsa group,” he adds.

At the same time, the reports of the independent expert and Deloitte, which make a similar estimate despite having been prepared with different methodologies, are in a line of continuity with the forecasts and anticipated trends “by the most reputable bodies and the most analysts recognized”, adds the magistrate.

Hard blow to the family

The decision represents a heavy defeat for the Rubiraltas, the family behind one of Catalonia’s great industrial giants, but above all for its president, Francesc Rubiralta. In the position since 2010, he has focused in recent months on pressuring the different administrations to defend his interests: calls, meetings and, above all, a direct line with high levels of the State and the Generalitat, according to various sources explained in the ARA.

The sentence is a bucket of cold water for unions, employers and the Generalitat itself, which, through the Minister of Business and Work, Roger Torrent, expressed his support for the family’s project.

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