Lisbon, Aug. 6, 2024 (Lusa) - Inapa's Executive Commission said on Tuesday that Parpública was alerted to the sudden, "but avoidable" insolvency, which would directly impact 1,400 workers and make it impossible for a global paper distribution group to buy the company.
In the farewell letter to employees, to which Lusa has access today, the management recalls that the general meeting held last May, on the occasion of the approval of the accounts by the shareholders present, received "once again, a vote of confidence at the proposal of Parpública, as in previous years".
However, "these votes of confidence from the entity representing the State contrast with the lack of support over the years in making the debt restructuring viable", and "they also contrast with the recent stance of Parpública, which, despite talks that had been going on for months, only revealed in the final phase the existence of a binding instruction from the secretary of state of the previous government, which prohibited any financial contribution to Inapa", the Executive Committee points out.
And "they finally contrast with the lack of merely temporary support in a situation of imminent bankruptcy, which was totally avoidable", the organisation said.
Inapa's Executive Commission stated that it recently asked qualified shareholders - Parpública, Nova Expressão and Novo Banco - for "a short-term loan of €12 million, to be repaid in full by October 2024".
This need, "occasional in the summer due to the seasonality of the paper business, which we all know, was particularly aggravated in a context of increasingly lower credit limits from our paper suppliers, with an impact on our commercial capacity," it said.
In fact, "this short-term solution, which was presented to the reference shareholders, received the express support of private shareholders Novo Banco and Nova Expressão, which we would like to emphasise and thank".
But "unfortunately, and once again, Parpública's support was lacking for the realisation of an equitable solution already supported by the private shareholders, which would have avoided insolvency in Germany and the immediate and inevitable contagion to Inapa IPG and the entire group," the Executive Commission said, which clarifies that "there was never any question of Parpública supporting us to the tune of €12 million, but rather a loan of €8.4 million, proportional to its stake in the capital" of the company.
He emphasised, "It was a short-term loan for three months, remunerated at a market interest rate."
"Also contrary to what has been said, the repayment of this short-term loan was guaranteed by alternative sources of financing, supported in particular by proposals to acquire companies in our portfolio in different geographies, actionable in the fourth quarter of 2024, which was communicated and explained in detail to Parpública," it continued.
In fact, "it was widely shared with Parpública that, given the strict rules for declaring insolvency in Germany, the absence of the requested cash support would result in the insolvency of Inapa Deutschland and, by contagion, of the Inapa group, one of the main paper distributors in Europe, with a decision-making centre in Portugal, and with more than €1 billion in turnover".
In addition, "Parpública was also alerted to the fact that Inapa's sudden but avoidable insolvency would directly impact 1,400 workers, more than 200 of them in Portugal, and make the acquisition of Inapa by the global paper distribution group, which is under discussion, unfeasible."
The outgoing Executive Commission pointed out that the "inevitable insolvency of the group as a result of Parpública's lack of support was repeatedly and in detail explained to Inapa's largest shareholder who, holding 45% of the company, affected 100% of the shareholders and all the workers with his decision".
The Inapa group's value "now in insolvency will always be lower than the value it had before, not to mention the jobs, partners and other stakeholders, a massive destruction of value that was easily avoidable," warns the organisation, which throughout the letter blames Parpública for the company's situation.
"Since Parpública's decision was taken in full awareness of the consequences, the Board of Directors and the Executive Commission unanimously understood that there were no conditions for them to remain in the positions for which they were elected, at the proposal of Parpública itself, leaving no alternative but to submit their resignation," it explained.
It concluded: "Even in the very difficult context of Inapa IPG's insolvency and its immediate contagion to other companies in the group, we ensured the fulfilment of our responsibilities towards the workers and the state by paying salaries and taxes until we left."
Expressing their "deep gratitude" for the employees' commitment and dedication, "particularly during this difficult period," the Executive Commission ended the letter with wishes of "good luck for the future."
The Inapa group was founded in 1965. Its main shareholder is the public company Parpública, with 44.89%, while Nova Expressão has 10.85% and Novo Banco 6.55%. The remaining capital is dispersed.
In 2023, the paper distributor lost €8 million, compared to a profit of €17.8 million in 2022.
In the period under review, sales fell by 20% to €968.7 million, according to Inapa, while demand for paper in Western Europe fell by 25%.
Recurring earnings before taxes, interest, depreciation and amortisation (EBITDA) fell by 62% to €33 million, affected by the contraction in revenues.
Net debt fell by €14.4 million compared to 2022 to €206.7 million.
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