The entity replaced the chain as a collection agent. The company argues that measures to avoid the virus prevent it from taking steps
In the midst of the negotiations that he is carrying out with his creditors to renegotiate a millionaire debt, Ribeiro has just generated a strong dispute with Banco Patagonia for the funds that the home appliance chain received to finance its installment sales.
The conflict is linked to a series of trusts launched by the company to obtain funds in the capital markets that allow it to structure its credit plans, which is not reimbursing the financial institution, which, in turn, must transfer that money to the investors.
Because the situation became more complex and because of Ribeiro’s repeated breaches, the bank decided to remove the chain of household appliances from the role of administrator and low-collection agent of the trusts and cede those functions to the firms SEPSA (PagoFácil) and GIRE (RapiPago) so that they are in charge of collecting the collections.
The money involved is part of the Serie Ribeiro C, CI, CII, CIII, CIV, CV, CVI and Minicréditos 5 financial trusts, which were launched on different occasions with the support of Patagonia as fiduciary.
According to a statement sent by the bank to the Buenos Aires Stock Exchange, Ribeiro owed yield collections totaling $ 19.9 million until March 17, and considering all the trusts. The figure increased to $ 30.65 million as of March 26, which would have made it clear that the company is not turning the funds over to its owners, but that once it makes the collections, it would be using them for other purposes that they cannot find. clear.
For the financial institution, the amount owed would not be relevant because the harmful effects of the country’s economic crisis increased the degree of uncollectibility of the fees that Ribeiro’s clients stopped paying. However, as of last March 19, the new impact derived from the health emergency on the already complicated situation of the consumer sector and Ribeiro’s refusal to correct the deficiencies warranted a new evaluation of the situation by Patagonia that ended for deciding to replace Ribeiro.
“This Trustee estimates that the impact of the replacement of Ribeiro as a collection agent for each of the Trusts will be significant, given that the Trustee did not have alternative collection channels for its debtors, who pay their loan installments at the branches de Ribeiro, “explains the bank in the statement.
It adds that the situation given by COVID 19 will affect the operation of Ribeiro and will impact its collections, as reported by the company itself in its statement of March 26, 2020 published as a Relevant Fact on the website of the National Commission of Values (CNV).
“As a consequence of the replacement, the default of the trust portfolios could increase and consequently could generate losses for investors,” the entity also anticipates.
In fact, it is even possible that some of the trusts do not achieve full repayment of the fiduciary values if they take into account a series of costs of the fiduciary structures such as fiduciary fees, report of the control and review agent, auditor fee, qualification quarterly of the titles and publications in the markets.
“This Trustee is continually evaluating other collection modalities, additional or not, including the Trustee’s own channels as a financial entity, and other solutions for electronic payments in attention to the restrictions of attention to the public that emanate from the presidential decrees,” he highlights. Patagonia in its letter sent to the Buenos Aires Stock Exchange.
According to the reading of the document, it can be inferred that the home appliance chain is not turning the funds that it collects from its clients for the payment of the operations in installments that have been financed by the investors of its trusts.
What’s more, at some point that money, which would currently amount to $ 30 million, should be backed by Patagonia to the investors of the trusts, causing the bank a headache for a situation it did not cause.
However, Ribeiro has also just published on the website of the Buenos Aires Stock Exchange, a statement rejecting Patagonia ‘s decision to replace it as an administration and collection agent.
“In order to fully report the situation that the relevant fact communicated by Banco Patagonia S.A. has caused, we make it known that we have rejected the intimation that this entity directed us and its warnings,” states the letter signed by Manuel Ribeiro.
The argument that the owner of the company uses is aimed at qualifying the intimation of Patagonia as “illegal and inadmissible” and accusing the bank that the substitution of its role, “in addition to raising the pertinent legal proposals that we will formulate, will ultimately generate greater damages to the resumption of collections, due to the characteristics of the credits “.
Adds as grounds for the rejection the critical situation that the chain is going through as a consequence of the measures adopted by the Government to face the coronavirus pandemic.
It also refers to the rules that govern trusts in articles 8.11 and 8.12, of Section VIII of contracts in which, according to Ribeiro, the administration and collection agent only incurs non-compliance when it is attributable to its own shares and not for reasons of force majeure such as those currently suffered by the entire local economy from the effects of compulsory isolation.
“The second of the aforementioned articles rules that any delay or noncompliance referred to in Article 8.11, section a) of this Contract, shall not constitute a noncompliance by the Administration and Collection Agent if said delay or noncompliance could not have been avoided even if the Administration Agent had exercised reasonable diligence, and if said delay or noncompliance was caused by a fortuitous event or force majeure (including but not limited to, the enactment of laws, decrees, regulations and / or any other provision of legal or regulatory nature prohibiting, suspending or in any way, making the payments described in Article 8.11. section (a) impossible, “argues the company in its note.
That is, it clings to the fact that due to the declaration of a pandemic, made by the World Health Organization (WHO), the Argentine government issued DNU No. 260/2020, ordering a series of restrictive measures, completed with isolation social, preventive and compulsory. And the additional measures provided by the Ministry of Labor and the decisions of local and national authorities providing for the closure of branches and the isolation of its personnel, with the exception of those affected by deliveries of operations arranged by e-commerce.
“All this normative body and its complementary norms, as it results from its own recitals, constitute an impediment of force majeure or fortuitous case, whose notoriety exempts from additional accreditations according to article 888 of the Civil and Commercial Code of the Nation”, argues the Ribeiro’s owner in his letter.
It also warns that all of these facts widely exceed the risk forecasts explained to investors in the “Special Risk Consideration for Investment” chapter of the contracts.
“Ultimately, the fulfillment of the collections of the credits is impeded in the facts by a situation of” calamity or significant national or international emergency “, provided for in article 3.01, subsection VI, section a, of the Trust Contracts listed in the reference “, adds the document which also ensures that Patagonia previously knew about these situations through the daily reports of the Control Agent and
As a reinforcement of his position, the owner of the chain insists that he is “making the greatest efforts to redirect the fulfillment of our obligations, once the resumption of activity allows it, in addition to working on various strategies to In order to mitigate the situation, improve sales alternatives and restart collections. “
This paragraph refers to the negotiations that the company is carrying out to avoid default and present a plan to restructure its debt that exceeds $ 940 million.
The firm did not meet the maturity of an issue of Negotiable Obligations (ON) that placed it in a situation of uncertainty in a general scenario of falling sales of household goods and technology of more than 50% during the last 18 months, in addition of the lack of financing that ended up practically leading to the abyss to the home appliance chains.
In the particular case of Ribeiro, he had to close 20 of his branches and present a crisis prevention plan to the Ministry of Labor during the past year in order to partially overcome his serious financial situation, with almost 300 checks rejected for a total of $ 269 million. , a bank debt of $ 947.4 million, among other negative numbers.
The company has been executing a strong plan to cut its operations structure and has just asked banks for more time to present the restructuring program, which, in principle, had expired on March 31 and which could include debt relief or transfer of share capital and even sale mandate.
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