Abengoa has signed a contract with Algonquin Power & Utilities Corp. (APUC), which provides public services in the renewable and regulated energy sector, for the sale of a 25% stake in Atlantica Yield for $607 million.
abengoa viability plan
Carax Alphavalue |After earning the unhappy reputation of being the protagonist in Spain’s biggest ever bankruptcy case, engineering and renewable energy company Abengoa could be worth taking another look as a summer investment bet – albeit a high risk one.
Abengoa is trying to finalise the details which will allow it to go ahead with the sale of Atlantica Yield (Nasdaq:ABY) which manages electricity assets and has an approximate market value of $2.16 billion (around 1.93 billion euros). Abengoa has two options for closing the sale: Firstly, the direct handover of its 41% stake in ABY to the funds, including Brookfield, secondly placing blocks of its shares on the market.
While acknowledging that Spanish renewable energy and engineering firm Abengoa’s restructuring plan would ease its debt burden, Moody’s has cast doubts over whether it will be successful. Earlier this month, Abengoa reached a debt restructuring deal with its main creditors in an attempt to avoid Spain’s biggest ever bankruptcy. It had been in talks with lenders since November 2015 to reduce its over 9 billion euros debt pile.
The approval by Abengoa’s board for its viability plan led us to hope that it could be going in the right direction. But as the days pass, the balloon is beginning to deflate and the company, which was the first big Andalusian multinational, is now doing everything it can to avoid being engulfed in Spain’s biggest ever insolvency situation. But it’s not having much success.