Gefco's management board recently announced the purchase of 75% of the capital held since 2012 by Russian company RZD, the remaining 25%, owned by Stellantis, having been sold to French container ship owner CMA CGM. The transaction proved particularly tricky for the banks, which are financing the shipping company to the tune of 200 million euros. Spotlight on the banks' maneuvers to save Gefco.
A sale precipitated by the war in Ukraine
Since the start of the war in Ukraine, Gefco's majority shareholder, Russian Railways, has been placed under sanctions by the US authorities. At the beginning of April, the automotive transport and logistics group found a solution to avoid a possible closure, while banks such as ING, Citi, HSBC, Natixis and Société Générale, paralyzed by the risk of sanctions, threatened to turn off the financing tap.
Gefco has decided to buy the shares of RZD, a player reputed to be close to President Vladimir Putin and a major embarrassment since the Russian invasion of Ukraine, and sell them to CMA CGM for a total value of around 450 million euros.
" We had to find a solution, we're a viable company and we were going to suffer the sanctions and risk filing for bankruptcy ", the company states in a press release.
Blocked transactions
The payment of dividends to RZD did not make the banks' task any easier, given the sanctions imposed on Russia. The option considered was to go through Rosbank, a subsidiary of Societe Generale, which had not yet been informed of the sale and was not subject to sanctions.
The question of financing also arose for Gefco, which had benefited from a credit line of almost 45 million euros with the Russian bank Sberbank in June 2017. Although the company did not use up the line in full and decided to cancel the loan, this did not stop some banks, including ING, from denouncing their credit line to the transport group.
"In the sense of the commercial documentation, it was an event of default if RZD fell under the sanctions," the Dutch bank said at the time. The other institutions " suspended cash management operations between group companies and blocked foreign exchange and payment operations ", reports a trading player to Les Echos. These actions inevitably had an impact on transactions with suppliers who feared sanctions.
Despite their cautious approach, the banks were able to obtain a temporary sanctions exemption license from London.
" In the company, we're a little quick to forget that all the banks could have left; they tried to be constructive ," adds the same source, interviewed by the newspaper Les Echos.