Behind the collapse of the Frigoglass group and the impending change of ownership, shortly before the close of the half-year, are decades of mistreatment of owners and management, as well as exogenous, unpredictable factors such as the pandemic in 2020, the catastrophic fire in Romania in 2021 and the war in Ukraine. a century of activity in the glass industry and commercial refrigeration. A change in the ownership regime, the details of which remain unknown to the general public, even to some of the investors, as it is not disclosed who are the known bondholders who will receive 85% of the company’s shares, and who will take over its management. control the next day. However, according to information, these funds are mainly of American and British interests.

The only thing you can be sure of is that Freegoglass’s course of forcible change of ownership – after a credit event consisting in the non-payment of part of the debt and the execution, in fact, of the pledge on the shares that accompanied the bonds – was ordered, with signs the latest development, which will be seen already in the summer of 2022. In the financial report for the first half of the year, the auditors (PwC) note, among other things, that “the group is facing liquidity problems” and “a material uncertainty exists that casts serious doubt on the company’s and the group’s ability to continue as a going concern.” The same report states that the company’s management was already in talks with holders of senior notes worth 260 million euros maturing in 2025 on a restructuring agreement.

This agreement was actually announced on December 5, 2022, and it provides for the restructuring of a portion of the bonds (165 million euros), direct financing of Frigoglass in the amount of 33.25 million euros through the purchase of the original mezzanine bonds by the bondholders and the future exchange of the remaining bonds with a maturity of 2025 (95 million euros) with 100% capital of FrigoInvest Holdings. While this agreement has subsequently been amended twice to facilitate Frigoglass’s liquidity, we have finally come to the recent events where the company failed to pay the agreed fee and the bondholders exercised their rights to enforce the lien on Frigoglass shares.

The new agreement reached by the bondholders with the company provides that the former will gain control of 85% of Frigoglass, while existing shareholders will retain 15%. The transfer of assets, as well as staff contracts (5,129 people in June 2022), will be submitted for shareholder approval at an extraordinary general meeting scheduled for March 28. Truad Verwaltungs, which owns 48.55% and is essentially a stake in Frigoglass of the David-Leventis families, naturally agreed to the transfer of assets. What remains to be seen, of course, is what the minority shareholders will do, as 51.45% is in free float and Alfa Bank has 5.95%.

Crucial to the future of the company is the Extraordinary General Meeting scheduled for 28 March.

But have the events of the last three years brought Frigoglass to where it is today? And how can a company whose clients include Coca-Cola and the world’s largest brewers find itself in such a situation?

If you look back, you will find that in the 90s and 2000s the group was constantly buying and selling companies. It should be noted that a similar practice was followed by Mr. Harry David in the case of Paputsani between 2002 and 2010, which was maintained as management and ownership changed in 2010.

In 2000, she sold her stake in the GIOULA glassworks, her stakes in two Bulgarian companies, and increased her stake in Nigeria. In 2001, it acquired the commercial refrigeration business from its subsidiary The Coca-Cola Company in Nigeria, as well as a windshield and automotive glass company. In 2004, he sells his stake in a plastics factory in Bulgaria and buys a stake in another company in Romania.

In 2005, he sells his 51% stake in the Volos resin plant, and in 2007 opens a plant in China, with Mukhtar Kent of The Coca-Cola Company inaugurating. Nine years later, the factory ceases operations, and production is transferred to units in India and Indonesia. In 2009, it acquires the American professional refrigerator manufacturer Universal Nolin Company, and later closes operations in North America, Turkey and Greece.

Today the group has three glass factories in Nigeria, a plastics factory in Romania and 5 commercial refrigerator factories (Romania, India, Indonesia, Russia and South Africa).