The Appeals Chamber will decide the future of the Ribeiro appliance chain, which accumulates debts of more than $5.3 billion.
The historic appliance chain Ribeiro, With more than 110 years of experience in Argentina, it is facing a critical moment. Recently, formally communicated in a note sent to the CNV that the court rejected the agreement that it had signed with its creditors in the midst of the preventive bankruptcy that opened in 2021 and with which it seeks to restructure debts for more than US$5.3 billion.
More specifically, the company, which is led by the Ribeiro family, received a setback from justice regarding an agreement that it had reached with its creditors holding securities, negotiable obligations (ON), that it had issued in the market. Now the final word belongs to the National Chamber of Commercial Appeals.
Ribeiro had presented several settlement proposals to his creditors, which were improved on multiple occasions. In December 2022, the company presented its initial proposal, which was clarified and improved in February and July 2023. This proposal offered additional compensation for creditors holding corporate bonds, equivalent to 5% of the company’s future profitability.
In March of this year, the firm reached an agreement with its creditors, who accepted the proposal. Meanwhile, the judge in charge of the contest recognized the existence of this agreement. However, it did not immediately proceed to approval, since the Bankruptcy Court requested the intervention of the Public Ministry.
More here in time, In October of this year, the judge rejected the approval of the agreement and argued that the proposal did not take into account the necessary adjustments for inflation and that it did not respect the privilege of labor creditors.. This led Ribeiro to appeal the decision before the National Chamber of Commercial Appeals.
The truth is that now The future of the company depends on the resolution of the appeal. If accepted, the agreement can be approved and Ribeiro can continue with its restructuring plan. At this time, the company continues to operate under bankruptcy protection, hoping to reach a favorable solution for all parties involved, but The possibility of bankruptcy is once again latent in the company’s future.
The debacle
Ribeiro began to face financial problems in 2018 after a strong devaluation, which increased its financial costs and affected sales. Despite registering a record turnover of $370 million in 2017, the contraction of consumption and the country’s economic difficulties quickly deteriorated its situation. The 2020 pandemic, which forced the closure of branches and the interruption of operations, aggravated the crisis, to the point of leaving the company practically without income for months.
According to their balance sheets, between 2018 and 2019, shareholders invested US$20 million to try to sustain operations. However, the lack of financing and problems in the supply of products weakened their ability to recover.
The company, which once had around 90 branches and directly employed around 2,000 people, currently has a minimal structure. With less than 10 stores on the street and a website where it sells an extremely limited stock of products.
Source: Ambito
I am an author and journalist who has worked in the entertainment industry for over a decade. I currently work as a news editor at a major news website, and my focus is on covering the latest trends in entertainment. I also write occasional pieces for other outlets, and have authored two books about the entertainment industry.
