The sale process of Efacec by Isabel dos Santos has not yet formally started, but expressions of interest have already arrived at StormHarbour, the advisor of the business.
On January 24th, following the “Luanda Leaks”, Isabel dos Santos announced the sale of Efacec, but the operation has not yet formally started. StormHarbour, the business advisor, has already received expressions of interest in buying the industrial company, the whole and business segments, such as the Alpac Capital fund, ECO verified with sources that know the negotiations.
At this moment, negotiations are taking place between the representatives of Isabel dos Santos, the executive management led by Ângelo Ramalho and the creditor banks, of which Caixa Geral de Depósitos stands out. And, everything indicates, the preferred solution for the banks most exposed to Efacec, CGD and the Novo Banco, is the acquisition of shareholder control of the company, through a financial vehicle created for this purpose.
Isabel dos Santos’ main creditors in financing the purchase of Efacec are, in this order, CGD, Novo Banco, EuroBic, BPI and BCP. And part of the acquisition debt, around 160 million euros, is guaranteed. Banks like BCP, which have guaranteed loans, are not available to enter or take control of Efacec. The reason is simple: if they assume shareholder control, they will assume new risks of credit exposure to the company.
There is a huge financial risk ahead: Efacec issued 58 million euros of bonds a few months ago and a change of ownership will make the immediate maturity of those bonds mandatory. There will be a legal thesis that if the company is held by several funds, each one belonging to a bank, that obligation would not have an effect, but another source guarantees to ECO that what counts, for this purpose, is the sale, not exactly if it is a buyer or more.
Last weekend, the president of Novo Banco, António Ramalho, admitted that he could be, temporarily, a shareholder of Efacec, and that he has “accompanied CGD to support any solution.” This is a possible solution to ensure that the company does not lose access to bank guarantees essential to its business until the sale operation takes place.
It remains to be seen at what price the banks will be able to buy Efacec, but there are reference values for the business: the company’s debt exceeds 200 million euros (without counting the aforementioned bond issue operation). And EBITDA in 2019 was 23 million euros.