Publisher | Celsa and the productive economy

Celsa is an exceptional company from multiple points of view: it is the first private industry in Catalonia and leader in the steel sector in Spain and Europe, is a family business with a vocation for internationalization, innovation (it is central to the cycle of the circular economy linked to the steel industry, which did not close for a single day during the pandemic) and with a more than proven tradition of consultation with workers. When the successive crises (from the pandemic first, logistics and supplies later, and now from the war in Ukraine) remind us of the need to bring production centers and take care of the industrial fabric that survived the relocations of previous decades, the news of an industrial giant that, despite having the support of the State and the main local banks as well as the unions, may go bankrupt due to the lack of agreement with some funds merely financials deserves special interest. We are facing a specific conflict over the renegotiation of a debt, yes, but also, in a symbolic way, before the clash between industrial economics and financial economics. That thousands of jobs, 4,500 in Spain and 9,000 in the EU, are in danger due to the investment logic of a certain type of fund may be legal, but it is not legitimate. The consequences of the lack of agreement between the owners and some creditors, necessary to receive the injection of 550 million from the Statewould be so serious that the logic and willingness to make important assignments to ensure the continuity of the company must prevail.

The viability plan requires all creditors to agree to forgo almost a billion of the debt and some like Deutsche Bank, Goldman Sachs, and the SVP and Cross Ocean funds they don’t want to admit their share of error. The main discrepancies are between the subsequent distribution of the value of the company. The holders of the debt maintain that what the Rubiralta family, owner, is “incoherent” from a financial point of view, and that the debt has allowed the company to continue operating. But we must remember that they bought this debt in the secondary market with important removals (up to 80%) in 2010. Both parties have moved from their initial positions, albeit insufficiently. And they have less than two weeks to close a pact, because June 30 is the deadline after which the European Commission will stop granting business aid for covid. In July the scenario would change, since the company would be doomed to insolvency proceedings.

The pressures not to reach this limit situation come from all fronts. From the economic world, both the Catalan Foment employers’ association and the UGT and CCOO unions have claimed the need for the agreement; also from the political world, with appeals by the Generalitat de Catalunya and the governments of Cantabria, Euskadi and Galicia (where they have factories). Significant have also been the call from the President of the Government, Pedro Sanchezthe president of Deustche Bank, and the meeting between the economic vice president, Nadia Calvinoand the ‘conseller’ of Economy, James Giro. If we are to heed the declarations of creditors and owners, everyone wants the SEPI injection to go ahead. Therefore, the agreement is binding. It would be nonsense to bankrupt a company that may be viable. And a disastrous message for the future of our industrial model.

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