It has taken more than a year the listed group Urbas in closing the financial restructuring process of one of the historic Alicante construction companies: Ecisa. The Commercial Court Number 1 of Alicante has approved the judicial approval of the restructuring, by which the conditions agreed upon by Urbas with the creditors of the majority of the debt will be extended to the entirety.
The last financial crisis of Ecisa, which has carried out several refinancings in recent years before his transfer to Urbas in 2021occurred in mid-2023. Last year in the midst of the inflationary wave and with the escalation of costs, different administrations such as the Alicante City Council or the Generalitat Valenciana itself they opted for rescind awards to Ecisa due to delays in the works.
In this case, the treasury tensions not only affected the Alicante construction company, but also the rest of the companies in this division of Urbas: Construcciones Murias, Construcciones Urrutia and Ecisa were in a situation of “probable insolvency” according to the group itself, which led him to request the pre-bankruptcy process for them to negotiate an agreement with creditors avoiding insolvency.
Thus, on September 12, 2023, it announced the opening of negotiations with creditors to reach a restructuring plan, a deadline that was extended on several occasions, until Ecisa’s restructuring plan was presented on March 26, 2024.
Said plan includes the refinancing of its debt and the reorganization of its operationsby implementing a plan that will ensure its viability, as well as the payment of all its debts to its creditors. In fact, on June 13, 2024, improvements were presented to the content of said plan to convince the creditors, who approved it by a majority. To move it forward definitively, approval was requested in court, which was admitted for processing on July 18, 2024.
Now the Commercial Number 1 has approved the agreed conditions for the payment of that debt and the proposed viability plan, in an order dated October 8. It indicates that that feasibility plan passed the exam an independent review analysis business carried out by an external consulting firm, in this case Deloitte.
The order also includes the classification of creditors according to their liabilities and their guarantees to face collection. Caixabank, Banco de Santander and Banco de Sabadellwith their credits with real mortgage guarantee, appear in Class 1. Below them, Class 4 is made up of loans with ICO guarantees from Caixabank, Banco de Santander, Banco de Sabadell, Bankinter and BBVA. For its part, ordinary commercial credits, which include 554 caught suppliersappear as Class 5, which they sold to be the equivalent of ordinary bankruptcy credit.
Business decline in Spain
As Urbas acknowledged in its semi-annual results, “this restructuring process has resulted in a drop in the turnover and profitability of the national construction activity, mitigated in part by the improvement of operations in the international market.” In the first half of 2024 the billing of eThis line of business amounted to 30 million euros, less than half of the 67 million euros of the same semester of the previous year.
More complicated than the situation of Ecisa is that of Murias, since it is in necessary bankruptcy after the request of a creditor with whom Urbas maintains a legal battle.
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