Mexican president suggests Ahmsa chairman sell his shares in exchange for govt support

Bnamericas Published: Tuesday, January 24, 2023

Mexico’s President Andrés Manuel López Obrador suggested on Tuesday that the chairman of Ahmsa, Alonso Ancira, sell his shares in the steelmaker to local investors and present a debt payment plan in exchange for government support to overcome the company’s financial crisis.

However, the president reiterated that government funds would not be used to rescue the Monclova-based steel company that has debts with entities such as state oil company Pemex and public power utility CFE, which have led to power outages affecting operations.

"If Mr [Ancira] decides to sell his shares, hand over his shares in exchange for the debts he has, if he makes such an approach to us and responsible Mexican businessmen want to participate, of course we will help to maintain the company and strengthen it, because it is producing very little and getting worse all the time," López Obrador told his daily press conference on Tuesday.

Grupo Acerero del Norte has 64% of Ahmsa, while the free float is 34% and board members and directors hold 2%, according to corporate information for the third quarter.

Meanwhile, a spokesperson for the company, which in 2021 had a 6% share of the domestic steel market, confirmed that negotiations on investments in Ahmsa are underway.

"There is a negotiation process underway with investors. For confidentiality reasons, it’s not possible to say more," Francisco Orduña, Ahmsa's media communications coordinator, told BNamericas.

Local media reported over the weekend that the new president of the transformation industry chamber Canacintra, Alejandro Loya, said he was told by some members of the group that as soon as the end of January or the first week February there would be news about a capital injection in Ahmsa, which has not been producing steel for a month.

Ismael Leija Escalante, leader of the national democratic labor union, told local Monclova newspaper El Tiempo that talks on an investment in Ahmsa are solid and are about financing, not a sale.

In December, national media reported that Ahmsa had accused CFE of acting "in bad faith" after two of its plants in Monclova, in Coahuila state, suffered power cuts due to allegedly unpaid bills, noting that 17,000 jobs depend on the two facilities.

Orduña said that after the power outage at the end of November a debt of 129mn pesos (US$6.8mn) was settled 10 days later, which caused a delay in production, although he did not offer further details.

López Obrador said that "this company has a great future, because the demand for steel is going to grow…If [Alonso Ancira] had made a decision two years ago, the company would already have gotten ahead, just taking advantage of the times of good steel prices."

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