The Minister of Infrastructure guaranteed this Thursday that “the Government has no intention of nationalizing Groundforce”, saying that he believes that “the private shareholder will understand” that he has to give guarantees to TAP to receive the advances requested.
In a statement, released on Thursday afternoon, the president of Groundforce, Alfredo Casimiro, considered that the response he received from the Government to his proposal to make the company viable is “insulting, blackmail and a unacceptable ultimatum“.
The administrator said that he offered his shareholder position as a guarantee that the company will pay TAP the advances necessary to pay the missing wages and that the Minister of Infrastructure proposed the loss of the shares (50.1% of the capital) in Groundforce “If the State is late in granting the guarantee”, for bank financing.
“The minister knows that the proposal he made cannot be accepted in a negotiation in good faith. Contrary to what he promised us in July, the minister did not support us and is now the one responsible for the lack of payment of workers’ wages ”.
In view of these statements, Pedro Nuno Santos called a press conference, in which he stated that TAP has made “a great effort to support Groundforce”, but there came a time when “it cannot continue to make advances without having guarantees”.
The Minister of Infrastructure guaranteed that “the Government has no intention to nationalize Groundforce ”, saying he believes that the“ private shareholder will understand ”that he has to give guarantees to TAP to receive the advances requested.
Asked about Alfredo Casimiro’s statements, the government official devalued the “tone of the letter”, saying he understands taking into account “the desperate situation he is in”.
“I have to give a discount to the letter that was made public and I make that discount, because I understand the situation of despair where the private shareholder of Groundforce is. The tone of the letter is not relevant, what is relevant is that I have to do my job well – defend TAP and the Portuguese’s money ”, he declared.
Pedro Nuno Santos said he believes that it is still possible to reach a “solution”, which involves the “private shareholder understanding that the TAP has the right to protect itself“, Before making new capital advances to the company of which he is a shareholder (49.9%), which already total 12.3 million euros.
TAP proposed to make a new advance of 2.05 million euros for the payment of February salaries, demanding in return a attachment of Pasogal’s interest, Alfredo Casimiro’s company, until the debt is paid – until Groundforce receives bank financing.
“What we are unable to understand is, if it is in fact the intention of the private shareholder to pay TAP [a dívida], what is the problem of assuming ” [essa penhora da sua participação]. It scares us even more“, Added the minister.
In the same press conference, Pedro Nuno Santos explained that the private shareholder accepted the pledge of the shares related to his participation to receive the advance of around two million, but demanded, in case of execution, to maintain control of Groundforce.
“The private shareholder agrees to transfer the shares, but not that the consequences of this action are taken, that is, in the face of non-payment to TAP and the execution of the guarantee, TAP would become the majority shareholder, but control would remain private shareholder, who in the meantime was already a minority. This is unacceptable: increased exposure, but did not guarantee the protection of TAP ”, declared the government official.
In practice, he explained, “the actions [da Pasogal] passed to TAP, but meant nothing. They had no value from the point of view of controlling the company. TAP cannot accept a situation like this ”, he shot.
“If from the moment the financing comes in and if it is used to pay the debt to TAP, obviously there would be no risk of control of Groundforce by TAP”, he stressed.
Loan to Groundforce will be given by private bank
Pedro Nuno Santos also declared that “an operation involving a loan from a private bank, with a public guarantee” is being prepared by the Ministry of Economy and Finance “and that, in principle, this” arrives during the month of March“.
In a statement sent on Thursday, the private shareholder of Groundforce said that the bank loan “guaranteed by the State,” of 30 million euros from the announced Covid lines, was “already negotiated”.
The minister underlined that “it is necessary to understand that the demands that TAP is making are the same as those that the Portuguese State will require for the bank loan”.
“What is being declined today will eventually have to be refused at the time of the bank loan, because the requirements are the same“, He added.
Pedro Nuno Santos also said that Groundforce “has cash on hand that would allow it to pay half the workers’ wages”.
“We know that there are around 1.4 million euros in cash. I may be wrong in value, but we know that there is cash on hand in this dimension, ”he said.
“Total availability to go to capital increase”
Speaking to the ECO newspaper this Friday, Alfredo Casimiro said he was available to reinforce the company’s capital to face financial difficulties.
“When companies do not have capital or lose it for some reason, there must be capital reinforcements. THE my availability is total to go to a capital increase. ”
The chairman of the board recalled that Groundforce was in good health before the pandemic. But in 2020 the turnover fell to 63 million euros, 58% less than the 153 million registered in 2019. From profits of nine million, the company’s results went to losses of 25 million euros last year. “We have 10% of the number of flights, it is unaffordable,” he said.
The digital newspaper then asked the entrepreneur why he did not use the money that can be used to increase capital to pay overdue wages.
“I have a contract with TAP valid until December 2022 and it is not up to me, as an individual shareholder, to make capital increases. I have no guarantee. No businessman would put his money without guarantees of renewing a contract for at least five years, ”he replied.
While the restructuring plan is not approved by the European Commission, Casimiro recalled that Groundforce is already adjusting the business to face the crisis caused by the pandemic.
“We created savings and reduced costs by 60 million euros. We relieved the staff in about a thousand people, we received around 18 million euros in support from lay-off, we renegotiated contracts with a series of suppliers, terminated with some spaces ”, enumerated the manager, giving no guarantees that no more people will leave.
However, Casimiro is trying to be optimistic. “We believe that, in June or July, things will start to improve. (…) The world will come back. Groundforce was a successful company until the pandemic came and I believe it will be again. ”