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Four national banks are among the creditors of Mercon, which declared bankruptcy

Four national banks are among the creditors of Mercon, which declared bankruptcy

There are at least four local banks among Mercon’s creditors, which owe $363.34 million to various local and international financial institutions, and whose debts forced it to resort to Chapter 11, which allows companies to seek protection from being unable to fulfill their obligations.

According to the petition filed in a New York court, the local entities in possession of LA PRENSA, Banco Lafise, BAC and BDF are the local entities that need to recover their loans, although their amounts are smaller compared to the loans claimed by other entities. International financial institutions. The state-owned Banco de Fomento a la Produccion or Proproductomos also appears on the list of local entities.

Most affected by Mirkun’s bankruptcy filing is Rabobank Facility, to which Mirkun owes $202.55 million. This loan is part of a $500 million revolving credit line announced by the group in June 2021, and will be led by Rabobank, which has Dutch capital.

In the case of national banks, the most affected is Lafise Bancentro, which demands repayment of $26 million of the loan handed over to Cisa Exportadora and Mercon, on February 15, 2022. “The loan funds were used to cover working capital expenses. From the petition to date, the total amount owed under the Lafise Nicaragua Fund amounts to approximately $19.49 million in unpaid assets, plus accrued and unpaid interest, commissions and other expenses,” the document filed with the New York court states.

Lavis has the capital

One analyst, who requested to remain anonymous, explained that Lafise could face this debt if it cannot recover it, and the bank could overcome this default, despite punishing profits. “Lavis is over $100 million in capital. You have the option to restructure these loans or foreclose if you have the collateral. They will have to negotiate and see what is best for both parties or they may be paid from the assets sold. All of that will have to be seen,” he said. .

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He added: “But even if they make a loss, it should not be a complete loss because it must be assumed that they have some kind of guarantee, and that they have the ability to absorb losses because they have sufficient capital.” . They will stop earning and profits can be affected but they can deal with it. The important thing here is to see if there is a way to maintain activity this year by assuming some kind of arrangement that would allow the company in Nicaragua not to continue to be paralyzed. This is where all parties need to see how to cooperate.

Read also: Mercon, owner of Cisa Exportadora, has filed for bankruptcy in New York, but will continue operating

I’ll pay them while waiting

According to the document, the promissory notes that Mercon has outstanding with Lafise correspond to the following dates:

to. April 25, 2023, with principal amount outstanding of $3 million due October 25, 2023.
B. July 11, 2023, with principal amount outstanding of $4.40 million due January 11, 2024.
C. August 17, 2023, with principal amount outstanding of $1.50 million due February 17, 2024.
Dr.. August 25, 2023, with principal amount outstanding of $3.09 million and maturity on October 9, 2023.
And the. September 8, 2023, with principal amount outstanding of $7.50 million due October 9, 2023.

Two other banks

Another bank is BAC Nicaragua, which extended a $2 million line of credit to Cisa Exportadora as revolving credit on September 3, 2020. Of this amount, approximately $1.47 million of unpaid capital was outstanding, plus accrued and unpaid interest and fees . And other benefits, according to the document filed in New York court.

A similar amount is claimed by Bank Finance (BDF), which extended a line of $2 million to Cisa, on May 9, 2022.

“The agreement provides for a revolving credit facility in the aggregate amount of US$2 million, maturing on April 30, 2026 (the “Bahrain Development Bank Facility”). The loan funds were used to cover coffee harvesting expenses. As of the application date, the total amount outstanding under The Bahrain Defense Development Fund has approximately $2 million of unpaid senior debt, plus accrued and unpaid interest, fees and other expenses.

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“The loans from BDF and BAC Nicaragua are very manageable. Lafise’s volumes are larger and will therefore be more at risk,” the analyst said.

You can also read: The Ortega regime responds to the bankruptcy of Cisa Exportadora and says it will bring it into compliance with its commercial and financial obligations

Loaned by Producemos

Also shown is the state-owned Production Development Bank (Producemos), which provided a $6.7 million loan to Distribuidora de Granos de Nicaragua SA, a public limited company existing under Nicaraguan laws, and in whose loan Cisa appears as a guarantor.

Grant of a line of credit secured by a mortgage, pledge and deed of solidarity, dated 4 November 2016 (“2016 BFP Credit Agreement”), with Banco de Fomento a la Procción (“BFP”), as lender. The 2016 BFP Facility provides a term credit facility for an aggregate amount The amount of US$6.70 million matures on November 4, 2026 (the “2016 BFP Facility”). The document states that the 2016 BFP Facility is secured by certain fixed and biological assets.

There is also a second loan of $1 million, delivered to Mercapital Nicaragua, as borrower, and CISA, as guarantor under Public Instrument No. 37 dated April 4, 2018.

“The BFP 2018 Credit Agreement provides for credit in an aggregate principal amount of US$1 million, due on 4 April 2028 (“BFP 2018”) The BFP 2018 line is a secured line of credit for fixed assets. The proceeds of the loan were used for working capital for the coffee production business. As of As of the date of the order, the total amount owed under the 2018 BFP is approximately $500,000 of unpaid principal, plus accrued and unpaid interest, commissions and other expenses,” the document says.

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A third loan was also granted to Mercapital, with Cisa as the guarantor. It was a $5 million line, approved on November 27, 2020. “The BFP 2020 line is secured by some active stable funds. The loan funds were used as working capital for the coffee production business. So far, $4 million is waiting.

Also Starbucks

Among the creditors is Starbucks, which is demanding a line of $7.5 million, granted to Mercon as part of an amendment to the loan line granted on May 12, 2020, and maturing on May 11, 2029.

“The loan funds were used to make advances to farmers. As of the date of the petition, the total amount owed under the Starbucks Coffee Fund is approximately $7.5 million in unpaid debt. Principal, plus interest, commissions, and other accrued and unpaid expenses.

Mercon’s other creditors

In addition to the banks mentioned above, there are also dozens of international creditors exposed to Mercon’s bankruptcy. According to the document submitted to the court, the other institutions are:

1. Financierings-Maatschappij Voor Ontwikkelingslanden NV (“FMO”) $25 million loan.
2. Banco Internacional de Costa Rica, SA (“BICSA”), $4.5 million in debt, of which $3.5 million is in default.
3. BAC from Panama with a loan of three million dollars in case of default.
4. Common Fund for Commodities with a loan of five million dollars, four million of which are in default.
5. London Forfaiting bonds with a debt of $13 million.
6. ABC Brasil SA has a debt of $1.21 million.
7. Banco Safra SA has an unpaid debt of three million dollars.
8. Banco Santander owes $800,000.
9. Banco Agromercantil has a debt of $9 million.
10. FMO another $5 million loan.
Eleven. Mercon Ventures another $8.9 million.
12. Horizon Overseas $2 million.
13. Stichting and the Green Fund loan of $20 million.
14. A huge loan of $20 million.