Tuesday, February 27, 2024

ECONOMY | 01-08-2020 08:51

Fernández annuls DNU ordering intervention into Vicentin

President dramatically ditches takeover plan of agro-giant in series of tweets.

In a series of tweets, President Alberto Fernández dramatically annulled his emergency DNU decree ordering a state intervention of the bankrupt agro-firm Vicentin.

In a long thread of messages, the Peronist leader said he was rolling back on the move to nationalise Vicentin, the nation’s fourth-largest agro-exporter, and expressed annoyance at the behaviour of Reconquista judge Fabián Lorenzini for blocking verification of the soy-crushing company’s true debts and maintaining the existing board of directors.

“We’re repealing Decree 522/2020 ordering a 60-day trusteeship over Vicentin SAIC,” wrote the president, detailing his position in a series of posts.

Fernández said legal obstacles and the judge’s rulings had prevented the company from advancing, saying it could not fully determine the company's liabilities. Judge Lorenzini “has not allowed the State, until now, to know what the company’s real liabilities are,” he complained on Twitter.

The president said the court had “impeded” access and kept in place the same directors.

Vicentin, once Argentina’s biggest soymeal exporter, went bankrupt in December last year, calling meetings with creditors for February. In June, the president announced that the government would step in to “rescue” the firm and its employees. The decision to annul the decree and roll back the move to expropriate the firm is another twist in an incendiary tale. Farmers, industry leaders and the opposition all strongly opposed the announcement in June that the government would nationalise the firm, with protesters taking to the streets in Buenos Aires City and Santa Fe Province, where the firm is based.

Under the president’s decree, the government had 60 days to send a bill to Congress to expropriate the firm and officials were set to be appointed to Vicentin’s board of directors. That move, however, was blocked by Judge Lorenzini, who said government-aligned figures would only be allowed to act as observers, a development that put the Fernández administration’s plans in doubt and left the existing directors – who lead the company into financial trouble – in place. 

In his tweets, the president said that his administration would “not commit public resources while the current board of directors remain in place, nor will it form a trust sharing its management." 

An initiative led by the Santa Fe provincial government, seeking to establish a trusteeship with state participation, has also fallen through. 

Vicentin has debts of around US$1.3 billion, mainly with agricultural producers. It also owes US$255 million to Banco Nación, Argentina's largest state bank, for loans granted during the Mauricio Macri (2015-2019) administration. Those are now under investigation for suspected fraud.

"Our intention was always to rescue the company, preserve its assets, collaborate with the affected producers and maintain the sources of work," said Fernández.



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