La Seda Requests Opening of Liquidation Proceedings
Spanish PET producer La Seda de Barcelona, in insolvency proceedings since June 2013, has filed a request with the Barcelona commercial court overseeing the proceedings to liquidate the company and all of its subsidiaries. This includes PET polymerization activities and feedstock production as well as processing and recycling.
The company's board of directors said the decision to begin liquidation was adopted to facilitate an orderly sales process. Liquidation proceedings of some of La Seda's subsidiaries began in autumn of last year.
Interested parties, including Spanish rival Cepsa and PET world market leader Indorama of Thailand, reportedly have lined up to look at the businesses. Thus far, however, the only asset sale known to take place was the takeover of the 100,000 t/y PET plant at Volos, Greece, by Turkey's Polisan Holding.
La Seda's liquidation proceedings were preceded by a report of the company's receivers analyzing the financial condition of the group. Pinpointing the cause of the PET producer's insolvency, the receivers cited the inability to meet syndicated debt maturities, given the group's level of cash flow.
The receivers calculated the entire value of La Seda's assets, including real property, and concluded that its liabilities of €736.1 million exceeded its assets worth €624.2 million. At the same time, however, it warned that these may not be the final figures.
According to the estimate, the PET and feedstock production activities are the deepest in the red, with liabilities of individual subsidiaries - principally in Spain and Greece - in the range of nearly €500 million each.