BBVA & Sabadell Doubt in SanJose’s Recovery & Sell Debt With Loss

22/10/2014 – El Confidencial

Lenders abandon real estate firm SanJose one by one. As recently as this summer Santander and Barclays sold their debt shares in the syndicate at deep discounts. Now the time has come for BBVA and Sabadell as the entities put up for sale €135 million in loans in total. The buyer, Bank of America Merrill Lynch, bought the portfolio at 55%-off, having beyond distressed fund Värde Partners in the deal.

The sales prove rapidly shrinking confidence in rescuing SanJose and one may even state that the banks are afraid the firm will end up in bankrupcy and they will say good-bye to recovering their equity.

BBVA transferred €59.4 million in loans and it still maintains €25 million in current financing, as well as €47.9 million in bilateral credit. In turn, Sabadell sold a €74 million share with remaining €12.3 million in the current and €5.7 million in the bilateral.

Also, Caja Vital shed its part of the debt amounting to €3.4 million. In August, Santander disposed of €190 million and Barclays of €135 million in loans.

The refinancing agreed upon few months ago assumes a swap of €280 million in liabilities for a 70% stake in the real estate branch of the group, with no view to forgiveness.

SanJose’s indebtness totals at €1.96 billion. Huge part of it (€1.34 billion) has been borrowed for acquisition of another property manager, Parquesol, in 2007. The rest splits between the current financing (€325 million) and bilateral loans (€296.7 million).

Popular appears as the principal lender with €476 million lent, followed by Värde Partners (€450 million), his partner at real estate servicer and credit card business.

Next there ranks Abanca (before NCG Banco) with €328 million overdue, Sareb (€166 million) and Caixa Geral (€144 million). Also, Eurohypo, Bankia, CaixaBank, Unicaja, Caja Rural de Navarra and Millenium appear on the list of creditors. After the sales, Santander is left out with €86.1 million, BBVA with €73 mln, Sabadell with €18 mln and Barclays with only €1 mln.

Loss & Slump on the Stock Exchange

In the first half of the year, SanJose, earned mere €55.2 million and suffered further losses of €34.07 million. It means by 14.8% less than in H1 2013 and the sixth consecutive year in the red.

The results reflect an abrupt fall in income from construction, although it still creeps in positive, and a reduction in losses from the real estate division (-39,5%) to €38 million.

Refinancing agremeent drove the shares of SanJose up to the sky on the stock exchange, whose prices rose from €0.78 each in September to €1.11 registered on 19th that month. However, the values dipped down again to the previous level until marking €0.85 a share yesterday.

Year-to-date, the depreciation shows 29.17%, rounded to 38.5% in the last 12 months.

 

Original article: El Confidencial (by Eduardo Segovia)

Translation: AURA REE

On Refinancing News, SanJose’s Shares Soar up on the Stock-Market

22/09/2014 – Expansion

After the SanJose Group let know the National Stock Exchange Commission (abbreviated to CNMV in Spain) about the refinancing process it is currently undergoing, its shares upsurged considerably on the stock market. With general re-valuation of 38%, its shares went up by 33.7%, selling presently at a price of 1.11 euros a share.

The restructuring encompasses both a syndicated loan and bilateral loans, amounting to a €1.8 billion indebtness of the company.

Sanjose, chaired by Jacinto Rey, is at the brink of signing an agreement with its main lenders (Popular, Abanca, BBVA, Bankia, Värde and Sareb, among others) on an debt-swap operation, allowing the entities to avoid payment suspension and take a control stake (70%) in the real estate arm of the group, Sanjosé Inmobiliaria.

Initially, the banks will maintain the new financial scheme because they believe the company will start generating cash flows soon. Otherwise, they will carry out another debt-swap.

 

Original article: Expansión (by S. Arancibia & C. Morán)

Translation: AURA REE

Lenders Agree to Refinance SanJose in Exchange For Its Real Estate Business

19/09/2014 – Expansion

Over a year it took for the SanJose groups executives to come to an agreement with lenders and obtain a positive response from Popular, Abanca and BBVA to refinance its debt totaling at €1.8 billion. The banks will prolong the maturity deadlines in exchange for the property management division of the firm. The family office of the Reys, holding a majority of the company, can keep the control over construction activity of SanJose.

The full agreement is pending permission of Bankia, Sareb (the bad bank) and fund Värde which bought some indebtness from Santander and Barclays.

If all goes on duly, at the end of September or at the beginning of October, SanJose will breathe a sigh of relief. On the stock market, its shares sell at 0.83 euros a share, suggesting a total value of €54 million.

With the €280 million debt-for-equity swap, the banks will take control over 70% of Sanjose Inmobiliaria. Still, the matter of stakeholding in the SanJose business group remains to be resolved. Currently, 48% of it rests in hands of Jacinto Rey (pictured), 47% is divided among the founder partners of the group and 5% belongs to Liberbank.

SanJose had to plead to defer the payments several times due to being unable to satisfy them on time. In 2013 and this year, €77 million were due.

The financial troubles of SanJose root down to the listing of Parquesol in 2007. Two years after that, the firm managed to refinance €2.2 billion due in 2015. In 2013, the outstanding amount was reaching €1.35 billion and the company assured the loans were backed by a €1.73 billion worth of real estate.

The builder earned 16% less in the first half of the year (€230 million), with a turnover of €16 million and losses amounting to €34 million.

Real estate arm of the group gained mere €38 million in H1, out of which one third proceeded from rentals.

 

Original article: Expansión (by S. Arancibia & C. Morán)

Translation: AURA REE

Change in SanJose’s Board of Directors

1/09/2014 – Expansion

Guillermo de la Dehesa (pictured) has stepped down from the administation board of builder SanJose due to the limit set by a directive which reduces the number of managing boards of financial entities one may belong to. De La Dehesa has a seat in the Banco Santander board, too. The executive will be replaced by ex-minister Jose Manuel Otero.

 

Original article: Expansión

Translation: AURA REE

Santander & Barclays Leave San Jose in a Hurry, Selling Their Debt Share With a 50% Loss

20/08/2014 – El Confidencial

Once again banks get out of one of the few real estate giants that survived the recession hit. This time, Santander and Barclays opted for selling the loans given to Grupo San Jose for about €225 million with a more than 50% discount to Bank of America Merrill Lynch. Allegedly, a vulture fund is involved in the acquistion.

Specifically, Santander has sold €190 million in debt, while Barclays €135 million. Both banks saved small percentages of their assets, assuming the rest as a loss.

It is said that BofA Merrill Lynch sounds out other lenders of the construction company in hope of buying their part of the total of the €1.63 billion indebtness (some financial sources claim the amount reaches €2 billion).

Popular is the principal lender of San Jose, waiting for payback of €500 million, followed by Novagalicia (now Abanca) to which the group owns €400 million. Furtermore, €100 million to BBVA and less than that to CaixaBank, Banco Sabadell, Catalunya Banc, Caixa Geral, Unicaja, Eurohypo, Ceiss, Caja3 and Kutxa.

The sale of debt by Santander and Barclays does not affect the refinancing negotiations which the San Jose Group carries out with its creditors.

In the first half of 2014, San Jose earned €57 million and lost €34.07 million, which is 14.8% less than in H1 2013. The firm explains a 63.4% fall in the Ebitda with ´rental and developer price adjustment on the market´.

 

Original article: El Confidencial (by Eduardo Segovia)

Translation: AURA REE

SanJose Admits Having Troubles With Paying-Off €1.18 Bn in 2015

24/06/2014 – La Información

SanJose group says the economic depression that especially hard hit the real estate sector will not allow the firm to pay-off the €1.18 billion debt before 22nd April 2015.

In fact, the construction company is still negotiating with its lenders on refinancing the total debt of €1.3 billion, assuring that over the past months it has registered “significant advance” in the process. Another argument is the fact that it still operates normally.

At the end of December, SanJose´s order backlog showed €2.98 billion, by around 75 % more than a year earlier. During the first quarter of this year, it has increased to €3.03 billion.

The debt is mostly due to the loans pleaded by SanJose for the purchase of Parquesol Inombiliaria and Projectos. Still, the company is of good cheer.

 

Original article: La Información

Translation: AURA REE

Popular & Novagalicia Execute Debt & Seize San Jose´s RE Property

21/03/2014 – El Confidencial

Grupo San José has come to an agreement with principal lenders that granted a €2 billion loan to the construction firm in 2009. By virtue of assignment of payment, the banks received real estate assets. (…).

According to sources with knowledge of the negotiations, the operation will involve splitting San José into two divisions. The first one, inclusive of housing and land development assets, has been bringing losses to the company for the last six years. The other consists of construction assets that are much healthier in terms of toxicity.

The first step determined in the agreement between Jacinto Rey and the banks´ steering committee is the transfer of housing development activity to the lenders that could swap €1.6 billion for the branch´s shares. On the other side, the businessman would receive the construction company (…).

Among the lenders there are large banks like Banco Popular to which the firm owes €475 million, Novagalicia (€330 million), Santander (€260 million), Barclays (€186 million) and BBVA (€130 million). The entities that granted to San José loans of less than €100 million are: CaixaBank, Banco Sabadell, Catalunya Banc, Caixa Geral, Unicaja, Eurohypo, Ceiss, Caja3 and Kutxa.

Moreover, Sareb awaits return of its €186 million lent to the construction company by another entity but inherited by the bad bank. (…).

San José gained €427 million throughout 2013, that is by 14% less than a year before. (…) Its ebitda declined by 63% to €11 million, while the gross profit fell by mere €2.8 million (88.3% less). What is more, the real estate company had a turnover of €85 million (depreciation by 6.4%) and lost €209 million ( by 24% more). (…).

 

Original article: El Confidencial (Agustín Marco)

Translation: AURA REE

San José Enters Default & Requests Aid to Avoid Liquidation

18/03/2014 – El Cofidencial

Current talk of the town is a difficult situation of Grupo San José chaired by Jacinto Rey, facing maturity of a €2.400 million debt for last few weeks. After not having met requirements, the businessman negotiates with lenders (…) to waiver a syndicated loan granted to him in 2009. (…).

The company has not paid interest commission of €6.4 million before January 21st this year. The deadline was set by 85% of the lenders. (…).

Moreover, apart from the €81.9 million original payment amount, San José will have to add the not-fulfilled obligations from 2013 that amass the debt up to €139.14 million, deadlined in April. (…).

The Group came to an agreement with Banco Popular that had delayed payment of €77 million last year. The next and the last step will be to redeem €1.181,4 million that becomes mature in 2015, up to €1.320 million in syndicated loan. The debt expands to €2.400 million if several marketing and financial discount lines (€244 million), confirming process cost (€105 million), construction guarantee (€510 million) and other liquidity lines (€222 million) are taken under consideration.

Except for Popular, other lenders of the Group San José are: Sabadell, Novagalicia and Barclays. (…).

The only hope for the company right now is the new insolvency law that allows delay of payment if at least half of the lenders accept the proposal. However, the banks could demand guarantees and seize the majority of the capital (60%), now in hands of Jacinto Rey. (…).

At the end of 2013, San José recorded a €155.2 million loss, by 60% greater than in 2012 and four times bigger than the 2011 figures.

 

 

Original article: El Confidencial (Agustín Marco)

Translation: AURA REE