Steel Mills
Bankrupt AHMSA seeks new buyer
Written by Laura Miller
August 13, 2024
Altos Hornos de México (AHMSA) announced it will be entering the final stage of bankruptcy.
In Mexico, a commercial bankruptcy can have up to three stages: declaration, conciliation, and bankruptcy. A company must reach agreements with its creditors during the 185-day conciliation stage. If the agreements are not fulfilled, the company then enters the third phase of bankruptcy. That’s when the liquidation of assets begins in order to pay creditors.
An Aug. 9 statement from AHMSA said that a final extension of the conciliation stage has expired, and it will now enter the bankruptcy phase. It said an official bankruptcy declaration by the Second District Court is forthcoming.
Mexico’s Instituto Federal de Especialistas de Concursos Mercantiles will appoint someone to assume control of the company during the bankruptcy proceedings.
Search for new buyer
AHMSA said its current management and financial advisors are courting “both domestic and foreign groups interested in capitalizing on the company, with the primary objective of resuming operations as soon as possible in Monclova.”
The steelmaker claims it is currently in discussions with seven potential investors and steel companies. Due diligence visits have already been conducted by two companies, and more are anticipated in the coming weeks, it said.
“If an agreement is reached in the next months, the possibility of reactivating the company and preserving the source of employment would open,” AHMSA declared in the statement.
Status of assets
AHMSA’s assets have reportedly fallen into a state of disrepair since it ceased operations in December 2022. Mill and mining equipment are said to have been stolen or “lost.”
AHMSA’s restructuring plan had been for US-based investors Argentem Creek Partners to invest $2.2 billion to restart the company, with a staggered startup to begin next month.
SMU has heard rumors that the emerging markets investment firm was asset stripping with no real intentions of restarting the steelmaker’s operations.
Neither Argentem nor AHMSA returned SMU’s requests for comment.
Laura Miller
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