Vicentin reaction: Opposition coalition, crusher and biofuels chamber vent concerns

Cash-strapped Vicentin, the country’s main opposition party, and the national oilseed crushing chamber have all voiced concern over the government’s announcement late Monday that it is seeking to nationalise the company.

Argentine crusher Vicentin said it will protect the firm’s rights after the government of left-wing coalition Frente de Todos said it would expropriate the troubled crushing firm and pay off its debts.

“We claim the legitimacy of protecting the rights of an Argentine company and its shareholders, which is in accordance with the current legal framework, within a preventive bankruptcy process and who has repeatedly expressed the will to honour its commitments,” Vicentin said in a statement.

Vicentin declared its default in December 2019 and currently owes approximately $350 million to grain suppliers.

The firm’s overall debt including local and foreign banks is estimated at $1.5 billion.

Opposition coalition Juntos por el Cambio said it was strongly opposed to nationalising the crusher, saying it is illegal and contrary to the country’s constitution.

“This is an unnecessary and dangerous measure, with unpredictable consequences, that undermines confidence in the country and closes the door to the necessary investments to get out of the crisis caused by the pandemic,” Juntos por el Cambio’s statement adds.

And the country’s oilseeds crushing chamber Ciara also expressed its surprise for the sudden move by the government.

“Ciara understands the state's concern for the preservation of job sources.  However, within the preventive bankruptcy process initiated by the shareholders of the company, interested buyers appeared, guaranteeing the continuity of the company’s operation. For this reason we were surprised by the intervention,” Ciara said in a statement. 

“It is important that the future state-owned company is part of the same rules of the game and has a level playing field with other companies,” Ciara added.

Draft bill

The draft bill submitted to the Congress by the government to expropriate Vicentin stipulates that the expropriation process will be paid with the debt Vicentin currently has with state-owned bank Banco Nacion and with tax agency AFIP.

The draft bill will be initially debated in the Senate, where the ruling coalition has a majority.

In a radio interview, President Fernandez said that during the two-month intervention, the government will analyse if the expropriation is limited to the crusher or if it also includes other companies within the Vicentin Group.