September 26, 2020

state aid is “welcome”

The businessman Blas Herrero plans to address his possible entry into the shareholding of the Asturian engineering firm Duro Felguera next September. The owner of the radio station Kiss FM, one of the great Spanish fortunes, considers the eventual state rescue of the group to be good news, whose board of directors agreed on Tuesday to request to take advantage of the measures of the fund for strategic companies of the State Society of Industrial Participations (SEPI). State aid is, Herrero says, “welcome.”

In a telephone conversation with, the Asturian billionaire pointed out this Wednesday that his possible entry into Duro Felguera, about which he has been speculating for years, “is there.” “It is an operation in which I have never denied that I am interested” and although “at this moment everything is stopped” as a result of the coronavirus, “we have to wait a bit to see how the situation is defined in September.”

“I’m interested, I continue to see the issue and we have made many approaches, but there is still nothing concrete regarding a direct purchase,” says Herrero, who assures that the entry of SEPI into the group’s capital does not alter its plans at all: “Unlike”. In his opinion, a rescue operation necessary for the survival of the company is “welcome.

“I always said that Duro Felguera needs a rescue. They, the managers, have always denied it, and my idea was always that. Now they have recognized it,” says Herrero, who declines to specify what participation he would take in an operation that he would carry out together with other partners.

Critical situation

Duro Felguera has been in a critical situation for some time and in recent months has recruited former socialist ministers Jordi Sevilla and Valeriano Gómez for its board of directors. He also announced in June the signing of another former senior PP official, Elena Pisonero, who resigned shortly after he resigned due to possible incompatibilities. Last Tuesday, the highest body of Duro Felguera agreed to formalize the request to take advantage of the measures contemplated in the Government rescue fund for strategic companies, as well as to request the support of the Principality of Asturias.

The request for aid to the State is estimated at more than 200 million euros. It coincides with the departure of the shareholders of the until now first shareholders, the Domínguez family, owners of the Mayoral textile, which had 9.5% and in recent months they have bet on the stock market for other companies such as the Portuguese postal operator Correios de Portugal.

On July 22, Duro Felguera already announced his intention to avail himself of these rescue measures to continue developing his activity despite the impact of the Covid-19 pandemic. It is the first large Spanish company to use this state fund, endowed with 10,000 million.

The Asturian group has assured that it intends to “consolidate” the “traditional” activities of the company, “reformulate” the international activities to date and “promote” new lines of business in which it finds potential, such as digitization and the economy. green. “The council has verified that, as a consequence of the economic impact derived from the pandemic, the company is experiencing difficulties to maintain its normal activity,” the firm stressed in July.

The company rescue fund is articulated through different instruments such as the granting of participating loans, the acquisition of subordinated debt or the subscription of shares or other capital instruments. The amount of the dividends, interests and capital gains resulting from the investments made will be paid into the Public Treasury.

The fund is aimed at non-financial companies that are experiencing severe temporary difficulties as a result of the situation generated by Covid-19 and that are considered strategic for various reasons, such as their social and economic impact, their relevance for safety, health of people, infrastructures, communications or their contribution to the proper functioning of the markets.

Among the requirements to access the fund will be that of not being able to carry out an “aggressive” expansion, nor take excessive risks, nor distribute dividends, nor bonuses to executives. The minimum amount of aid will generally be 25 million euros. One of the uncertainties that he plans on the rescue of Duro Felguera is that one of the fund’s requirements is that the company’s crisis be overtaken by the pandemic. In the case of the Asturian, it is earlier.

The company, the largest Asturian industrial group with national capital, recorded losses of 9 million euros until March after recording a provision of 10 million in the results of the first quarter of the year due to the uncertainty scenario generated by the coronavirus health crisis. For its part, turnover was reduced by almost half, to 45.5 million euros.


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