Abengoa CEO Quits Due to Increasing Concern towards the Firm’s Fate

by San Antonio Attorney

Santiago Seage, Abengoa’s Chief Executive, recently submitted his resignation after rumors circulated that the company is on the verge of bankruptcy.  Concerns have risen due to the impending doom of the company, which has 29,000 employees.

Gestamp, a Spanish engineering group, was supposed to be a promising company slated to render the much needed financial resources to Abengoa.  However, the deal had fallen through and the debts were slowly accumulating.

Gonvarri, a subsidiary of Gestamp, initially planned to buy up 28 percent of Abengoa for some €350 million.  (US$370 million) This merger should have made it the renewable energy firm’s biggest shareholder.

Unfortunately, the deal fell through and Abengoa proceeded with its bankruptcy protection filing last Friday.  The move gave the company another chance to find a set of creditors in a span of four months.

The resignation of Seage was accepted by the company last Friday.  Jose Dominguez Abascal, a board chairman, will handle all operational powers preceded by Seage.

Abengoa has been around for the past 70 years, its potential risk to dissolve alarmed Unions and politicians, since the company also employs 28,700 people worldwide, including 7,000 in Spain.

Alberto Garzon, Spain’s far-left candidate for the incoming December elections, pleaded the government to rescue the company.

UGT, one of Spain’s main unions, coerced the authorities to find a solution.

“What we cannot allow – neither Abengoa workers, nor Spanish society, nor the industrial sector of our country – is to let this company disappear,” said Candido Mendez, head of UGT.

Luis de Guindos, an Economy minister emphasized on how essential it is for the company to find an industrial partner.

This statement did not help as de Guindos appeared to reject any bailout of the company.

 

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