Start search


Search in web contents
Adding value to spanish exports


Pescanova faces the sell-off of its business outside Spain

Teresa Sánchez

Sabadell, Popular and Caixabank are its main shareholders and are willing to inject 150 million euros to save the company's business in Spain, but want none of its international activity, which accounts for almost half of group sales.

Sources closed to the company say that "we're looking at the break-up of the entire international business", and admit to being "concerned about the consequences of such a decision, which could end up dragging down the entire group".

After taking the helm of Pescanova, the banks would offload the fish factories in Chile, Central America and Portugal, in which the company's former chairman, Manual Fernández Sousa, invested 450 million euros in the last few years, which led the company into technical bankruptcy after having assumed far too much debt.

The banks have already decided to sell all of those businesses to slash debt, which has generated interest by leading fishing groups such as Marine Harvest from Norway, Cooke Aquaculture from Canada, and Charoen Pokphand Food from Thailand.

Pesca Chile, which owns Acuinova and Nova Austral and is focused on salmon production, is one of the first companies that may exit the group. It commenced insolvency proceedings in May 2013 and has total debt amounting to 88 million euros and losses of over 80 million euros, making it one of the group's biggest headaches.

Grupo Damm, which bid with the banks to take control of Pescanova, and the new chairman, Juan Manuel Urgoiti, have done everything in their power in recent months to impede its sale. However, the liquidator managing the subsidiary's bankruptcy, Herman Chadwich, has organized the auction, which is now in the final phase.

The fish factories in Mira, northern Portugal, which produce turbot and have financial debt of 99.8 million euros, face an equally challenging situation. What's more, sources say that the facilities need an additional 40 million euros urgently for working capital and to remain operational. Nova Guatemala's future is slightly less dramatic. This company, which specializes in prawn production, has piqued the interest of Charoen Pokphand Food, the largest fishing group in the world.Its bank liabilities are less than 2 million euros, although it's worth noting that the company has always been loss making.

As Pescanova waits for an industrial partner to replace Damm in the shareholder structure, there's every indication that its future lies in deep-sea fishing. For that to happen, the company says it's vital that it maintain the fishing rights it has obtained over the year, especially in countries such as Namibia and Mozambique.

The situation is especially complicated in the former. Several leading government officials there, including the Minister of Fisheries, have met in recent months with the company's management, warning them that it would reconsider current contracts in the event of a change in control of the company.

Sabadell, which is owed 226.7 million euros, will become the company's primary shareholder after part of the debt is capitalized. Popular will rank behind it, with 182 million euros, and CaixaBank third, with 178 million euros.

The debt will be restructured in three tranches: 450 million euros of senior and super-senior; 250 million euros of junior; and 300 million euros of subordinated. The debt will mature in 10, 15 and 20 years, respectively.

Wikispanishfood does not take responsibility or necessarily identify with the opinions expressed by its collaborators, limiting itself to becoming a transmitting channel of the same