Abengoa has completed the signing of the restructuring agreement with its creditors, which allows it to avoid the threat of bankruptcy that existed on the company due to the lack of liquidity it suffered, obtaining new financing, as well as the restructuring of its debt to stick to your updated business plan.

In a fact relevant to the National Securities Market Commission (CNMV) , the company announced the signing of the restructuring agreement and the start of the accession period until September 11.

After the firm's final resolution was delayed up to four times, the engineering and renewable energy group has signed an agreement that allows the company to move forward.

Thus, Abengoa, which in 2016 already dodged what would have been the largest creditors' contest in the history of Spain, after being burdened by a debt of almost 9,000 million euros, closes a new financial 'rescue' plan, the third in recent years, after those of 2017 and 2019.

Specifically, the agreement assumes that Abengoa Abenewco 1 (Abenewco 1), which is the parent company of all businesses and for whose needs all these new funds must be used exclusively, will receive a five-year loan for an amount of up to 230 million euros for which the ICO guarantee has been requested under the provisions of the Royal Decree-Law of urgent and extraordinary measures against the social and economic impact of the Covid-19, which will be new liquidity.

In addition, a new five-year 'revolving' line of guarantees is subscribed for an amount of up to 126.4 million euros, expandable to 300 million euros, all with the aim of financing the liquidity needs and guarantees of the group led by Abenewco 1 until the end of 2021. These guarantee lines have CESCE coverage for 60% of the international tranche. Additionally, the Andalusian Government is also expected to contribute an additional 20 million euros in this rescue plan.

Furthermore, pending compliance with certain precedent conditions, Abengoa SA will need to reestablish its equity balance by converting debt into participative loans with a necessary level of accessions of 96%.

Likewise, the operation contemplates a restructuring agreement of pre-existing financing and new financing received with this agreement, signed by a group of investors and financial creditors that participate in the existing financial debt and the financial entities that will provide the new liquidity. and the new line of guarantees, and which refers to Abenewco 1 and other group companies.

The restructuring plan for the company also includes specific agreements with suppliers within the perimeter of the company Abenewco 1 and which will consist of the voluntary exchange of its debts for a participation in a long-term syndicated loan issued by Abenewco 2 Bis, which will only have recourse and it will be payable with the funds obtained from the monetization of certain assets, as well as the immediate payment of 6.25% of the aforementioned loan.

It will also imply that, before the end of this year, all convertible instruments are converted into Abenewco 1 shares, both those that are currently issued and new ones that are issued within the framework of this new restructuring, which will entail, necessarily, the breakup of the current economic group, led by Abengoa, SA., which will become a minority shareholder of Abenewco 1, with 3.52% (pre-dilution), as long as its situation of equity imbalance can be resolved.

And it is that the restructuring operation of Abenewco 1 would not be sufficient by itself to be able to rebalance the assets of Abengoa, SA, which is in the process of dissolution, since it will also be necessary for a majority of 96% of the liabilities of the company at the request of conversion of its debt of 153 million euros into participative loans.

In the summary financial statements presented in May 2019, Abengoa announced net losses of 517 million euros in that year, compared to the 'red numbers' of 1,498 million euros in the previous year.

The group indicated that, at the end of 2019, the net equity of the individual company Abengoa showed a negative amount of 388 million euros, which placed it in a situation of dissolution.

In this way, the group begins a new stage that will allow the company to grow sustainably and continue working on 'EPC' projects for third parties.

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