The truth is clear in the aquaculture sector: The decline in fish consumption continues, and the increase in financial and operational costs is becoming difficult to digest. Market remains swollen and challenges remain in key fisheries. As a result, at least three companies in the sector – Fandicosta, Actemsa and Atunlo, Prensa Ibérica’s Faro de Vigo reported – have resorted to bankruptcy law due to serious treasury strains; Many other companies risk following suit. Negotiation processes take place to better weather the storm or resolve elements of uncertainty. Catalan Frime, Spain’s second largest operator in the salmon segment, is seeking an agreement with a pool of banks to syndicate around 50 million euros of currency, this newspaper has learned. “To have such an amount bilaterally “It was something that could be improved – with different assets across different lines – it was a weakness,” say sources familiar with the process. Organizations and companies are planning to make a deal before the end of the year or at the beginning of next year.
The aim is twofold: to avoid periodic and evaluative negotiations with the bank and to ensure stability in the financial field. The operation on the table includes the extension of the currency’s time frame from one to three years, with the possibility of two extensions (1+1) in line with certain economic requirements. Consulting firm EY was selected Frime for consulting work and preparation of an IBR (independent business review). Like many operators in the industry, the company has made significant investments in recent years to improve production processes and ensure the utilization of raw materials. The new La Roca del Vallés factory alone required around 25 million euros. Banks state that this effort to gain industrial capacity is a factor that accelerates negotiations.
Deals
In any case, market sources significantly reduce the tone of alarm regarding Frime. They state that it will end the year with an operating cash flow (the amount of cash generated by a company in a given period) of €25 million, 14 of which will be allocated to repaying bank debt to “address the next phase of growth”. .” “In no case does it need new money, the structure will not be changed long-term financial,” they continue. Likewise, they note that this group has not experienced a decline in sales of its products (loin and tuna in portions) as has been experienced by much of the industry. They attribute this to long-term agreements with distributors for the horeca channel (restaurants) and retail chains (retailers, supermarkets).
Yes, their annual accounts show a very high volume of stock – which is important at Atunlo, for example – which is a factor that creates tension in the cash register. The same sources consulted attribute this to the decision to “procure” and currently estimate it to be around 65 million euros. In such a situation, it is common for a company to have to conduct a liquidation of raw materials at large discounts and what is understood as a bulk sale. Same agreements with customers and “stability” They state that they avoid choosing this path of urgency or necessity by moving away from the negotiation environment. “It will be down by 50% this year thanks to repeat sales, which has allowed tensions to ease.” Frime closes its fiscal year With 185 million invoices and sales of approximately 40,000 tons in 2022.