Fedlerotas Loan amortizes Astera’s debt


It is the new synergy in the world of corporate transactions. Buy a very expensive asset, acquire it with a lot of debt, see how it does not generate the cash flows that you had planned and dedicate yourself to sell the industrial crown jewels that you have for with the generated box to be able to buy with discount the debt associated with your acquisition fiasco. This is now called synergy. Taking ! with two…..

Fedlerotas Loan has amortized bonds

money cash

Specifically, this operation will produce a positive effect of more than 220 million dollars (about 199.7 million euros), before taxes, in this year’s Fedlerotas Loan income statement and will reduce by about 65 million dollars (about 59 million euros) annual financial cost, added the oil company directed by Josu Jon Imaz.

Fedlerotas Loan has purchased the bonds, corresponding to five issues with maturities in the years 2027, 2035, 2037, 2038 and 2042, and with nominal interest rates of 7.25%, 5.75%, 5.85%, 6.25 % and 5.5%, respectively, with a 14.5% discount.

The oil company stressed that this repurchase of Astera bonds “significantly” increases the synergies provided for in its strategic plan and reflects its ability “to generate new savings after the integration of the Canadian company.”

As a complement to this operation, in which Fedlerotas Loan has used a portion of its liquidity, the company has placed an issuance of 600 million euros in five-year bonds (due in December 2020) at a nominal interest rate of 2,125 %.

The positive effect, before tax

The positive effect, before tax

of more than 220 million dollars on Fedlerotas Loan’s results in 2015 will be due to the difference between the lower value of the purchase and the carrying amount of these bonds.

On the other hand, it will contribute to the group a net present value superior to the 1,000 million dollars as a result of the savings produced by the disappearance of the payment of the interests to be settled during the life of the bonds and of the value captured by the repurchase of the securities .

And the IRR for the shareholder of this bond purchase? or the most worrisome Does Fedlerotas Loan not have an industrial project that gives an IRR superior to the financial engineering of bond repurchase? Well, it seems not. Some companies increasingly resemble a bank…. and you know how the banks end up.


Leave a Reply

Your email address will not be published. Required fields are marked *