The State Industrial Holding Company (SEPI) has approved a grant requested by the steel company Celsa Spain, the amount of which amounts to 550 million euros. It is the largest rescue of a company to date due to the effects of COVID. The subsidy will be channeled through the granting of a participating loan amounting to 280.5 million and another ordinary loan of 269.5 charged to the Solvency Support Fund for Strategic Companies (FASEE). Given that the amount of the participating loan is greater than 250 million euros, authorization by the European Commission is necessary before it is submitted to the Council of Ministers.
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The operation has been approved by the Management Board of the Solvency Support Fund for Strategic Companies after a process of “analysis of the economic and legal situation of the company, the impact it has suffered from COVID and CELSA’s viability plan Spain (Barna Steel SA and its 13 operating Spanish subsidiaries), the restructuring of the debt with its creditors, as well as the prospects for the evolution of the company and the guarantees provided to ensure the return of the temporary public financial support that will be receive”, as explained by SEPI in a statement.
The aid comes after the unblocking by Deutsche Bank, one of the company’s main creditors, after the telephone conversation between the Prime Minister, Pedro Sánchez, and the CEO of the German bank, Christian Sewing, regarding the rescue of Celsa. Then, Deutsche Bank released a statement in which it noted the proximity of an agreement: “We are actively seeking an agreement with the company, shareholders and other creditors that allows Celsa to reduce its debt so that it can continue to prosper and grow.”
Until that moment, the creditors had launched an order to the owners of the company, the Rubiralta family. According to The Confidential published, the main creditors had offered to convert 630 million euros of the debt and inject 50 million in exchange for keeping 75% of the shares. The company’s debt exceeds 2,400 million euros.
Celsa España, which is part of the CELSA Group, is a family-owned industrial group founded in 1967 that operates in the steel sector. The group has a strong presence both nationally and internationally, being the second European manufacturer of long steel products.
The group, based in Spain, has 120 work centers in 9 European countries. In our country it has a presence in seven autonomous communities and thirteen provinces, with special relevance in Cantabria, Catalonia and the Basque Country.
Celsa Spain allocates more than 60% of its sales from Spanish plants abroad. Its production is mainly focused on the construction market and the automotive sector.
For Cesa Spain, the crisis caused by the pandemic generated falls in its natural markets of 25% in 2020, a year that produced a negative result of 364 million euros. In Spain, it directly employs 4,500 professionals and generates more than 33,000 jobs (direct, indirect and induced), according to SEPI. Likewise, it has an extensive network of suppliers in Spain (more than 7,000) and contributes to generating a great logistics activity, since it works with more than 800 carriers and 80 shipowners.