Fleeced Mexican investors against big banks, hedge funds.
After nine months of fraught negotiations with its senior creditors, Spain’s teetering green-energy giant Abengoa is tantalizingly close to a financial fresh start. In August, the firm announced that it expects to win the approval of at least 75% of its creditors for a restructuring plan by September 30. The banks and hedge funds that own most of its debt are already on board.
But not everyone’s convinced. The company’s B-shares have barely budged from the 0.20 level since the announcement. As WOLF STREET reported a couple of weeks ago, the US rating agency Moody’s played down the restructuring plan’s chances of success, citing three main causes for concern:
The firm’s precarious liquidity situation; Its unseemly high leverage ratio (even after the restructuring is completed) The towering list of conditions and obligations to which it will be bound once the agreement is finalized. The biggest issue was how two of Abengoa’s largest, most valuable markets – Brazil and Mexico – would react to the company’s announcement that it was seeking preliminary protection from creditors.
This post was published at Wolf Street by Don Quijones ‘ September 15, 2016.