EiDF, the Galician solar group focused on self-consumption plants, has resumed activity after a period of scrutiny. The company circulated a memo based on a report from a major Spanish law firm to Bolsas y Mercados Españoles, the operator responsible for the BME Growth market where EiDF is listed. The earlier claim of irregularities faced a denial, with Deloitte, the auditing firm involved the previous July, noting concerns about the listing in BME Growth that serves smaller and mid-sized enterprises.
The Deloitte findings, released on August 24, followed a suspension of EiDF from the BME Growth market due to the company not publishing accounts for an extended period. The audit highlighted potential issues, including possible falsification of documents and contracts drawn up by company directors, as well as several invoices and service payments that lacked reasonable justification. These assertions prompted a formal investigation into the company’s financial disclosures.
In response to these serious allegations, EiDF engaged KPMG Abogados to obtain a new legal assessment. The subsequent document argues that none of the behaviors described in the Deloitte report contain enough elements to fit applicable offenses, asserting the absence of simulation or infringement of legally protected property. The opinion further states that there is no indication of a pattern of simulated legal actions or other anomalies from a contractual or commercial standpoint.
From a business perspective, EiDF specializes in photovoltaic installations for the industrial sector and has experienced rapid growth over the past year. Its market capitalization reached a notable peak, placing the company among notable peers and drawing comparisons with larger entities. This intense ascent traces back to the company’s humble origins in Barro, a small town in Pontevedra, where its founder, president, and CEO lived. Yet, on April 14, the landscape shifted as the National Securities Market Commission decided to suspend the company’s listing amid disputes with its newly appointed auditor, PwC, which affected the ability to finalize accounts within the statutory deadlines.
Following the resumption of accounting disclosures after the suspension, EiDF’s market value declined significantly. The impact was particularly harsh on individual shareholders, who held a minority stake, and on major investors who had financial exposure tied to the IPO. The chief executive, who controls a major shareholding, also saw a substantial swing in personal assets. A notable investor group including a Catalan family behind a prominent furniture brand had a meaningful stake at the time of the suspension, but that stake diminished sharply in value post-disruption.
Corporate governance and internal controls
Deloitte’s report emphasized the need for a comprehensive action plan to reinforce corporate governance and internal control procedures. A newer legal opinion, issued subsequently, characterizes EiDF’s corporate structure as continually adapting to evolving regulatory requirements and highlights ongoing boardroom developments. The document notes proposed governance changes to strengthen oversight and accountability, with a plan to propose an expanded board at the forthcoming shareholders’ meeting.
The anticipated agenda includes increasing board membership toward a twelve-member slate, with independent directors to be added. Proposals also contemplate including new directors as special officers to bolster governance and oversight. The bloc of major shareholders remains heavily concentrated, with several investors maintaining significant stakes that influence board decisions.
Among the major stakeholders, one consortium holds a substantial portion of the capital, while others with sizeable holdings maintain a visible influence over corporate direction. Governance discussions have centered on balancing representation and ensuring effective oversight, particularly in relation to the company’s evolving ownership and its impact on strategic decisions and compliance with regulatory standards.
Overall, the narrative around EiDF’s governance underscores the ongoing effort to align internal controls with market expectations and regulatory requirements, while navigating the complexities of rapid growth, investor expectations, and the responsibilities that come with being a listed company on a market designed for smaller and mid-sized enterprises. The company’s leadership remains focused on stabilizing its governance framework and safeguarding shareholder value as it advances with strategic plans and capital formation efforts. [Citation: Deloitte report and KPMG Abogados assessment are referenced for context and validation.]