Tax Agency and that has been fulfilling for years
El Deportivo will begin to face this year the ordinary bankruptcy debt and the privileged one that it contracted with the financial entities, a commitment of payments that is added to the one collected in the singular agreement that it agreed with the Tax Agency and that has been fulfilling for years.
With the change of the year, in addition to meeting the payments foreseen with the Treasury in the singular agreement signed by both parties in March 2014, the Coruña group will have to begin to satisfy the ordinary bankruptcy debt and that corresponding to the financial entities Abanca and Sabadell Gallego .
The club was forced
To enter into bankruptcy in 2013 with 160 million euros of debt that remained at 140 with the 33% reduction agreed in the agreement that was signed in January 2014, still with Augusto César Lendoiro as president, and that also included two years of grace and 17 years to pay without interest.
Of the bankruptcy debt, 100 million euros had a privileged character (without loss), 30 corresponded to ordinary debt (subject to the 33 percent reduction), and another 30 were considered as subordinated debt (with 33 percent reduction) , which will start paying after 2032.
Already with Tino Fernández as leader, the club agreed in March 2014 the agreement with the Tax Agency, its main creditor, in relation to the privileged debt, with an annual nominal interest of two percent and that he promised to pay starting January 2015 with two installments per season until 2023 as long as the club remained in First.
Subsequently, in July 2015, Deportivo presented the agreement with financial institutions Abanca and Sabadell Gallego to refinance the debt of 14 million euros that it had with both and that it will pay in 2032.
El Deportivo explained then that the amortization structure was progressive, with a lower load in the first seasons and a greater one in the last tranche of the loan, once the club fulfilled the amortization of the privileged debt with the Tax Agency, in the year 2023 (provided the Coruña team remains in the First Division).
Thus, until January 2023 the capital to be amortized in an ordinary manner is 20% and, in the final tranche, between July 2029 and July 2031, 40%.
Under this agreement, the expiration of the operation was fixed in the 2031-2032 season, with an initial grace period until January 2017.
In addition to this debt with banks from a syndicated loan, Deportivo had to face a bilateral loan with Abanca for an amount of 13 million that was refinanced until 2029 with the signing of an advertising contract with the bank that cancels annual fees .
At the last shareholders’ meeting, on December 1, the sports president, Tino Fernández, boasted of economic numbers in front of the partners.
“If we continue like this, in three years, the fat, it is over, there will still be debt, but much more acceptable,” said the president of Deportivo, Tino Fernandez, who was harsh with the previous administration, that of Augusto César Lendoiro.
Fernandez also said that the club is “forced to generate large profits” for the payment schedule that must be addressed from now on.
The objective of the club will be to “recover the balance of assets” after closing the 2015-16 financial year with a decline in negative equity from 90.57 million euros to 83.49.
On June 30, the liability of Deportivo was almost 115 million euros, of which 82.87 correspond to long-term debt and 9.96 are included as short-term debt.
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