Spanish fishing giant Pescanova could be flat broke April 15, according to sources quoted by Europa Press, having only enough liquidity to cover payments to suppliers and pay taxes until that date.
If Pescanova, which has filed for bankruptcy, fails to complete the sale of a business it has in Chile, it will require a bridge loan of between 50 and 60 million euros after the 15th to meet working capital requirements.
The situation doesn't bode well for its subsidiary Pescafina (see related story below). Pescanova's creditor banks are still waiting for the company to finally present its 2012 financial results to the National Securities Commission (CNMV) before opening talks on a restructuring plan for the company. Pescanova failed to meet the April 5 deadline for presenting a complete balance sheet and profit and loss account for last year.
Auditors are also awaiting access to further documentation and suspect that there may be more hidden debt and assets within the fish processing firm. Pescanova may have used front companies to declare only minority interests in overseas firms in order to avoid having to consolidate the debt they are carrying on the group's balance sheets. They also suspect the company has failed to declare operations involving letters of credit.
Company sources insisted Pescanova has supplied all necessary information to its auditors and that it is not trying to hide debt. But the company has dismissed its current auditor BDO and is preparing to file a suit against it. PwC and Deloitte have been touted as likely candidates to carry out a forensic audit of Pescanova's accounts in order to detect possible incidents of fraud or irregularities.
