Argentine gov. faces calls to take Vicentin public to stave off bankruptcy

Pressure is mounting to turn cash-strapped oilseed crusher Vicentin into a non-state public company, with a group of government officials, activists, rural associations and union leaders with ties to the left-wing ruling coalition Frente de Todos urging the government to save it from bankruptcy. 

“Being evident that the fraud consumed by Vicentín includes the irregular use of public credit and the express commission of tax evasion and money laundering... we consider essential and urgent that the government takes control of the situation and, using the tools of the State, intervenes in a bankruptcy protection process,” a letter signed by 35 individuals said. 

Those named included Claudio Lozano, director of state-run bank Banco Nacion, Vicentin’s largest creditor, and social leader Juan Grabois, who has previously called for the company to be nationalised and is promoting agricultural reform in the country.

“Vicentin is strategic and key for the sovereignty and the control of food production. That is why the national government should not allow it to fall into the hands of actors who, under another name, would maintain and deepen the same behavior contrary to the national interests that Vicentin had until now,” the letter continues. 

“This is why we propose that the government take the necessary steps to transform Vicentin into a non-state public company under political and social control,” it concludes.

The signatories also requested an urgent meeting with President Alberto Fernandez to discuss this issue. 

Vicentin has been struggling since defaulting on payments to grain suppliers and brokerage firms in December 2019, as the company struggled to meet debt repayments.

Producers immediately suspended trade with the crusher, and the crushing facilities were stopped, with the company thought to owe approximately $350 million to grain suppliers, while the firm’s overall debt including local and foreign banks reaches $1.5 billion.

According to previous press reports, Vicentin was working  to reach a private agreement with its creditors in the grain segment in the short term.

The agreement, which needs to be approved by a court, requires an acceptance of at least 66.6% of the debt.