Abengoa SA on Friday said that its chief executive, Santiago Seage, had resigned after it emerged the Spanish renewable energy giant was close to bankruptcy, as concerns rise over the fate of a firm that employs close to 29,000 people.
The company announced on Wednesday that a deal with Spanish engineering group Gestamp — which had been due to inject much-needed cash into the firm — had fallen through, leaving it with a mountain of debt and the threat of becoming Spain’s largest-ever corporate failure.
On Friday, it said it had accepted “the resignation of Santiago Seage,” adding that all operational powers would now be in the hands of board chairman Jose Dominguez Abascal.
Gestamp subsidiary Gonvarri had planned to buy 28 percent of Abengoa for about 350 million euros (US$371 million), which would have made it the renewable energy firm’s largest shareholder.
However, the deal fell through and a court in the southern city of Seville — where the company is headquartered — said on Friday it had launched bankruptcy proceedings, which offers Abengoa protection from creditors for up to four months until it finds a solution.
Unions and politicians are increasingly concerned about the fate of the 70-year-old firm, which employs 28,700 people around the world, including 7,000 in Spain.
Spanish politician Alberto Garzon called on the government to rescue the company while the General Union of Workers (UGT), one of Spain’s main unions, urged the authorities to find a solution.
“What we cannot allow — neither Abengoa workers, nor Spanish society, nor the industrial sector of our country — is to let this company disappear,” UGT head Candido Mendez told Cadena Ser radio.
Minister of Economy and Competitiveness Luis de Guindos said it was important for the world player in solar and wind power, biofuels and water management to find “an industrial partner,” but he appeared to reject any bailout of the group.
“Any action by the government will be constructive, but we also have to take into account that there are limits in European regulations with regards to state aid,” he said.
De Guindos said that from “a business point of view, [the company] is viable.”
“Now what is most important is to find out exactly what the accounting and debt situation of the company is,” he said.
Shares in Abengoa have been suspended from Spain’s main IBEX-35 after they went into freefall.
Various bank creditors of Abengoa are to meet creditors KPMG on Monday, a source involved in the talks said on Friday.
The creditors plan to discuss the next steps to take in the restructuring the company’s debt with the consultancy after they named KPMG their adviser in the process, two sources said.
KPMG declined to comment.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure