1 July 2015 – Faro de Vigo
Sareb, also known as the ‘bad bank’ has decoupled itself from Grupo San José‘s refinancing program. Sources confirmed yesterday that the body chaired by Jaime Echegoyen (pictured above) has sold the liability that it held with the Pontevedra-based construction group and will therefore not participate in the €100 million warrant issue (which may be convertible into shares) scheduled by the company. According to the same sources, the bad bank has sold its debt to Bank of America, which hereby strengthens its position as a creditor of San José and will acquire more than half of the warrants.
According to documentation submitted by the firm chaired by Jacinto Rey – which successfully dodged bankruptcy thanks to an agreement reached with its creditors – Sareb was going to acquire warrants amounting to €6.936 million. Sareb had voted against the Pontevedran group’s debt contract, but the Commercial Court approved the agreement and forced by the bad bank and KutxaBank – which had also rejected the program – to underwrite the obligations.
With the decoupling of Sareb from the construction group, the creditors that will acquire warrants will be: Bank of America (almost €54 million), Banco Popular (€25.1 million), Deutsche Bank (€10.468 million), Barclays Bank (€10.037 million) and KutxaBank (€251,241). According to the terms of the contract, this group of creditors will take ownership of 35% of the Galician group if it is unable to repay its €100 million loan in 2019. By virtue of the construction company’s bailout agreement, the creditors have now taken over control of the company’s real estate division, comprising assets worth more than €1,400 million (primarily land, completed developments and buildings for rent).
Original story: Faro de Vigo (by Lara Graña)
Translation: Carmel Drake