SynopsisA Barcelona court has granted approval for creditors to take control of Celsa, Spain's largest private industrial group, through a multi-billion euro restructuring plan. This marks a significant test of Spain's new insolvency law, allowing debtors to use pre-insolvency mechanisms. Under the plan, creditors will convert 1.352 billion euros of debt into equity, taking full ownership, while extending the maturities of remaining debt. The court recognizes this as the "only viable alternative" for Celsa's future. The restructuring aims to preserve jobs and strategic decision-making centers while appointing a new board to maximize the company's value.ArticleIn a pivotal development, creditors of Celsa, Spain's largest private industrial group, have received the green light from a Barcelona court to take control through a multi-billion euro restructuring plan. This event marks a substantial test of Spain's recently enacted insolvency law, which empowers debtors to utilize pre-insolvency mechanisms while enjoying court protection.Under the approved plan, creditors will assume 100% ownership of Celsa by converting €1.352 billion of debt into equity. Simultaneously, they will extend the maturities of the remaining debt by five years. The creditor consortium, which includes financial giants like Deutsche Bank, Attestor, Anchorage, GoldenTree, and SVP, had struggled to reach an agreement with the Rubiralta family owners regarding the restructuring of approximately €3 billion of debt.The court's ruling, which is final and not subject to appeal, validates the creditors' authority to implement what the court terms "the only viable alternative in the medium term for the entire Celsa Group."Judge Alvaro Lobato, in a detailed 156-page document, emphasized the creditors' commitment to "strictly comply with their commitments, preserving and increasing the value of the company, safeguarding jobs, and maintaining the strategic decision-making centers crucial for the economy as a whole."While Celsa itself declined to comment on the development, the creditor group issued a statement affirming their dedication to sustaining the company's operations in Spain. They intend to appoint a new board of directors with the aim of maximizing Celsa's value, positioning it as a European leader in the sector, securing jobs, and ensuring sound financial management.Lobato's approval of the plan hinges on its alignment with all legal requirements. Given that the debt significantly outweighs the company's value, the court believes that the creditors' proposal assures the viability of the Celsa Group.The dispute between the Rubiralta family and creditors had revolved around Celsa's valuation. Shareholders advised by investment firms Lazard and AZ Capital assessed the value between €5.8-6.7 billion, while court-appointed consultancy firm Lexaudit placed it between €2.4-2.8 billion, potentially rendering the equity worthless.Crucially, the plan endorsed by the court does not necessitate public capital injection from the Spanish state-owned fund SEPI, translating into savings for both the Spanish state and taxpayers.This development underscores the complexities of corporate restructuring and the delicate balance between debtors, creditors, and preserving economic stability.ConclusionThe approval for creditors to assume control of Celsa through a multi-billion euro restructuring plan signifies a pivotal moment for the company and Spain's new insolvency law. This development highlights the intricate dynamics of corporate restructuring, with creditors converting debt into equity and extending maturities to ensure Celsa's viability. The commitment to preserve jobs, strategic decision-making centers, and financial stability underscores the significance of this event. Celsa's future, now under creditor ownership, will be closely watched as it navigates the challenges and opportunities that lie ahead.
SynopsisA Barcelona court has granted approval for creditors to take control of Celsa, Spain's largest private industrial group, through a multi-billion euro restructuring plan. This marks a significant test of Spain's new insolvency law, allowing debtors to use pre-insolvency mechanisms. Under the plan, creditors will convert 1.352 billion euros of debt into equity, taking full ownership, while extending the maturities of remaining debt. The court recognizes this as the "only viable alternative" for Celsa's future. The restructuring aims to preserve jobs and strategic decision-making centers while appointing a new board to maximize the company's value.ArticleIn a pivotal development, creditors of Celsa, Spain's largest private industrial group, have received the green light from a Barcelona court to take control through a multi-billion euro restructuring plan. This event marks a substantial test of Spain's recently enacted insolvency law, which empowers debtors to utilize pre-insolvency mechanisms while enjoying court protection.Under the approved plan, creditors will assume 100% ownership of Celsa by converting €1.352 billion of debt into equity. Simultaneously, they will extend the maturities of the remaining debt by five years. The creditor consortium, which includes financial giants like Deutsche Bank, Attestor, Anchorage, GoldenTree, and SVP, had struggled to reach an agreement with the Rubiralta family owners regarding the restructuring of approximately €3 billion of debt.The court's ruling, which is final and not subject to appeal, validates the creditors' authority to implement what the court terms "the only viable alternative in the medium term for the entire Celsa Group."Judge Alvaro Lobato, in a detailed 156-page document, emphasized the creditors' commitment to "strictly comply with their commitments, preserving and increasing the value of the company, safeguarding jobs, and maintaining the strategic decision-making centers crucial for the economy as a whole."While Celsa itself declined to comment on the development, the creditor group issued a statement affirming their dedication to sustaining the company's operations in Spain. They intend to appoint a new board of directors with the aim of maximizing Celsa's value, positioning it as a European leader in the sector, securing jobs, and ensuring sound financial management.Lobato's approval of the plan hinges on its alignment with all legal requirements. Given that the debt significantly outweighs the company's value, the court believes that the creditors' proposal assures the viability of the Celsa Group.The dispute between the Rubiralta family and creditors had revolved around Celsa's valuation. Shareholders advised by investment firms Lazard and AZ Capital assessed the value between €5.8-6.7 billion, while court-appointed consultancy firm Lexaudit placed it between €2.4-2.8 billion, potentially rendering the equity worthless.Crucially, the plan endorsed by the court does not necessitate public capital injection from the Spanish state-owned fund SEPI, translating into savings for both the Spanish state and taxpayers.This development underscores the complexities of corporate restructuring and the delicate balance between debtors, creditors, and preserving economic stability.ConclusionThe approval for creditors to assume control of Celsa through a multi-billion euro restructuring plan signifies a pivotal moment for the company and Spain's new insolvency law. This development highlights the intricate dynamics of corporate restructuring, with creditors converting debt into equity and extending maturities to ensure Celsa's viability. The commitment to preserve jobs, strategic decision-making centers, and financial stability underscores the significance of this event. Celsa's future, now under creditor ownership, will be closely watched as it navigates the challenges and opportunities that lie ahead.
