Molino Cañuelas SACIFIA, one of Argentina's largest food and grain mill producers, is nearing bankruptcy after 18 months of failed talks with creditors to restructure its US$1.4-billion debt, according to those familiar with the company's strategy.
Aldo Navilli, the leader of the family which controls the business, is working with Argentine law firm Estudio Alegria, Buey Fernández, Fissore and Montemerlo to prepare a court filing that would protect its assets in a process similar to US Chapter 11, reported the individuals, who requested not to be identified as discussing private conversations.
The measure would establish a battle with lenders, including ING Groep NV and Rabobank UA.
An outside spokeswoman for Molca, the abbreviation for Molino Cañuelas, declined to comment, citing a confidentiality agreement with creditors.
Estudio Alegria did not respond to a request for comments. Lazard, Molca's financial advisor, declined to comment, as did Columbus Zuma, advisor to the creditors.
Molca's debt problems date back to 2016 when a drop in the peso and a sharp economic contraction made it difficult to pay off dollar-denominated loans, but the idea of bankruptcy became more attractive after agribusiness rival Vicentin SAIC took that path earlier this month in its own battle with creditors.
While an agreement is still possible, Navilli is frustrated with the negotiations which have gone on for more than a year and a half without receiving anything in return for its efforts, according to people familiar with the issue.
Navilli was willing to provide capital to the company's creditors to pay off its debt and reluctantly offered his 178-acre golf club on the outskirts of Buenos Aires which hosts a stop on the PGA Tour Latin America.
A bankruptcy petition could be filed next month and it would come as a surprise to creditors, a group of about 20 banks, who made a counter-proposal in the last few days in which they offered to accept several assets, including the golf course, to withdraw about half of the debt and set an interest rate close to 5.5 percent on the remaining obligations.
Molca, based in Buenos Aires, sells food and industrial products and agribusiness services, such as grain storage. Its flagship product is the ‘9 de Oro’ line of sweet and savoury cookies, which Argentines usually have with mate.
by Pablo Gonzalez, Bloomberg