The paths to achieve control of the day of the board of directors and the maximum shareholder run in parallel. The governing body of the supermarket chain, in which the Letterone Fund is not represented Russian tycoon Mikhail Fridman In spite of having 29% of the shares, it meets on Friday to prepare the call for shareholders meeting that must approve its capital increase for 600 million and its rescue plan. On the other hand, Letterone prepares the tender, which will be presented next week, and has defended its plan before a group of Spanish analysts, to whom it has explained the "critical situation" in which the company is immersed. Next week he will do it with international analysts in London.
With the letters of each one on the table, each of the sides that dispute the company goes ahead with their plans. The board of directors, led by Borja de la Cierva, has met this Friday to design the agenda for the call of the shareholders' meeting. Sources close to the council have explained that the meeting could be extended because of the complexity of the documentation that must be submitted to the vote of the shareholders. According to the regulations of the shareholders' meeting of Dia, the meeting must be convened at least one month in advance.
The main thing that the owners must decide is the capital increase that the council has designed for an amount of 600 million euros -To which Letterone will not attend-, which would serve to put the company back in positive patrimony -because of the technical bankruptcy situation in which you are right now– and recompose the capital structure and achieve a long-term financing agreement with the bank. Right now, the banking gives air until May, with a preliminary approval to continue maintaining the support with 765 million financing until 2023 (conditioned to amortize 100 in advance with the sale of the Clarel perfumeries and the Max Discount wholesale supermarkets, which are already on sale). If he succeeds, he has designed a reflote plan until 2023 which includes, in addition to price reductions and commitment to the fresh and white label, the closure of 600 of the more than 4,500 stores it has in Spain.
For its part, Letterone also maintains its roadmap. In your case, go through the Opa for 70% of the company that does not own at a price of 0.67 euros per share, conditioned to achieve adhesion of at least half of that 70% and, afterwards, submit a capital increase of 500 million euros – secured by Goldman Sachs and conditioned on the success of the takeover and not approve of the council – and launch a five-year strategic plan, similar to that presented by the council, to refloat the company. The fund, which has confirmed that it will formally present the bid and the pamphlet that will accompany it next week, has gathered a group of financial analysts today to give them details of their plans.
At its first meeting in a law firm with a dozen financial analysts of banks and investment funds that follow the company – next week there will be another meeting in London – Stephan DuCharme, head of L1 Retail, the division of Letterone dedicated to retail, has transmitted that Dia is in a "critical situation, absolutely limit", as was evident in the results presented last Friday, with losses of 352 million euros in 2018, a situation resulting from the "mismanagement" of the dome, according to market sources.
To alleviate this situation, he has explained the Letterone rescue plan, a five-year plan that includes price reductions, betting on the white label and closing stores, similar to the one handled by the council. He has defended that the L1 Retail team has a great experience in the sector to carry it out successfully, although he warns of the first two years of the plan, of zinc, will be "complicated".
Regarding the group's debt, DuCharme has confirmed to the analysts that Letterone will not request a withdrawal from the creditor bank, but an extension of the maturity dates of the different tranches of the debt, which currently exceeds 1,450 million euros.