November 17, 2024

Galicia Is Ready to Aid Ailing Spanish Fishing Company

The offer coincided with an extraordinary board meeting of Pescanova, called by some of its institutional shareholders. They are pushing for Pescanova’s longtime president to explain how the company ended up with accounts that do not match the debt claims filed by its creditors.

Pescanova filed for bankruptcy protection on March 1 after failing in an effort to divest some assets to help meet its debt refinancing obligations, which this year amount to about 200 million euros, or $260 million. The company then announced in a separate filing on Wednesday that it had found “discrepancies” between its accounts and its actual bank debt, a gap that “could be significant.”

Pescanova reported debt of 152 million euros, or $198 million, at the end of September 2012, which was eight times its annual operating profit.

Pescanova’s downfall provides fresh evidence that Spain’s debt crisis has stretched well beyond the banks and construction companies that have been at the heart of the country’s economic downturn. Although financial market pressure has eased on Spain, banks remain reluctant to lend to companies whose earnings have been hit by slumping consumer demand and a recession expected to last through this year.

Until recently, Pescanova was considered among Spain’s most successful food companies, with operations from Latin America to Africa. From its operational base in the northwestern port of Vigo, in the region of Galicia, it also headed an industry that remains among the country’s leading employers as well as the biggest recipient of fisheries subsidies from the European Union.

The government in Madrid has so far played down the troubles of Pescanova. After the company’s bankruptcy filing, the agriculture minister, Miguel Arias Cañete, said he was confident that Pescanova would solve what he described as a “temporary problem.”

However, Francisco Conde, the economics minister of the regional government of Galicia, underlined the extent of Pescanova’s difficulties on Thursday, telling reporters that the regional authorities now stood ready to provide “economic and institutional” help to the company once the full extent of its debt problems became clear.

The board meeting on Thursday was requested by some of the company’s main institutional investors, led by Corporación Económica Damm, which holds about 6.2 percent of the stock, and Luxempart, which has a 5.8 percent stake. Pescanova’s 45 creditors have scheduled a separate meeting on Friday to discuss how these financial institutions should act to ensure the company will eventually repay its debt.

Pescanova’s president, Manuel Fernández de Sousa-Faro, took charge in 1980 of the company, which was founded by his father two decades earlier and grew rapidly as a major player in the frozen-fish sector. Its operations now include fish factories in countries like Namibia and Honduras.

Mr. Fernández de Sousa-Faro controls about 28 percent of his company’s equity, including a stake that he bought back from NovaCaixaGalicia, the leading savings bank in Galicia. The bank was among the lenders that had to be rescued by the Spanish government because of its mountain of bad loans.

Investors have sent Pescanova’s shares tumbling 57 percent since the start of March. On Wednesday, the market regulator suspended trading in the shares.

Pescanova also breached its legal obligations to report earnings by the end of February. The market regulator said it would investigate that breach, as well as the latest accounting discrepancies, along with possible insider trading.

Article source: http://www.nytimes.com/2013/03/15/business/global/galicia-ready-to-aid-ailing-spanish-fishing-firm.html?partner=rss&emc=rss

Edgar M. Cullman Sr. Dies at 93; Helped Broaden Cigars’ Appeal

Edgar M. Cullman Sr., a cigar maker who worked to broaden the appeal of his product in the late 20th century, helping transform its public image from an unwieldy mobster’s appendage to a cool and slim object of desire, died on Sunday at his home in Stamford, Conn. He was 93.

His son, Edgar Jr., confirmed his death.

The elder Mr. Cullman was the longtime president, chairman and chief executive of the General Cigar Company, a leading manufacturer that over the years produced some of the country’s most ubiquitous cigars, including inexpensive and midpriced brands like White Owl, Tiparillo and Tijuana Smalls, and higher-priced ones like Macanudo, which has long been among the country’s best-selling premium cigars.

The Cullman family, known for its multigenerational tobacco interests, was involved with General Cigar from the early 1960s until 2005, when the company was sold to Swedish Match, a maker of snuff and other tobacco products. That year, General Cigar reported sales of more than $170 million, according to Culbro, which was General Cigar’s corporate parent from the 1970s to the 1990s. (Culbro is today the family’s private equity company.)

Edgar Meyer Cullman was born on Jan. 7, 1918, and, as a company publicist told Business Week in 1968, was “diapered in tobacco leaf.” His great-grandfather Ferdinand Kullman was a wine and tobacco merchant from Germany who settled in the United States in the 1840s. Ferdinand’s sons, Joseph and Jacob, founded Cullman Brothers, a tobacco brokerage house, in 1892.

Edgar’s father, Joseph Jr., was an importer and grower who acquired swaths of land in the Connecticut River Valley, where much of the tobacco for cigar wrappers is grown. His father also acquired the controlling interest in the cigarette maker Benson Hedges before selling the company to Philip Morris in the 1950s.

Edgar’s brother, Joseph III, a longtime chairman and chief executive of Philip Morris who died in 2004, steered that company to immense profitability, presiding over its well-known advertising campaign, “Come to Marlboro Country.”

Edgar Cullman earned a bachelor’s degree in economics from Yale in 1940 and afterward expressed a desire to join the family business. His father secured him an apprenticeship at H. Anton Bock, a cigar maker on Second Avenue in Manhattan. There, young Mr. Cullman learned to sort and roll tobacco, making cigar after cigar by hand at his workbench.

In 1961, Edgar Cullman and a group of investors bought the controlling interest in General Cigar for about $25 million. Based in New York, the company was then the country’s second-largest producer in terms of sales; its brands included White Owl, Wm. Penn, Van Dyck and Robert Burns.

Mr. Cullman was elected president and chief executive at the end of 1962. In 1963, General Cigar sold about $70 million in cigars, for about 11 percent of the market; by 1967, Business Week reported the next year, the company’s revenue — not all from cigars — was $220 million.

Mr. Cullman entered the field at a propitious time. Postwar cigar makers had begun seeking to transform the image of their product from Edward G. Robinson gangsterism to Steve McQueen cool. They sought in particular to attract young smokers, who had long gravitated to cigarettes.

The surgeon general’s report of 1964, which established a link between cigarette smoking and several serious illnesses, was the saving grace cigar makers were looking for, propelling many cigarette smokers toward cigars for the first time. (Cigar smoking was later shown to have its own associated health risks, including cancers of the mouth.)

Mr. Cullman enthusiastically capitalized on this exodus with smaller and milder cigars, including Tijuana Smalls, introduced in 1970. Designed to feel more like cigarettes in the hand and mouth, they were specifically aimed at a young market.

Under Mr. Cullman’s stewardship, General Cigar also diversified its holdings to include the Bachman line of snack foods, Ex-Lax, packaging companies and real estate. The company’s name was changed to Culbro in 1976.

Mr. Cullman stepped down as Culbro’s president in 1981, but remained chief executive for another decade and a half and chairman until the company’s sale in 2005.

In 1996 Culbro opened Club Macanudo, an upscale cigar club and restaurant on the Upper East Side of Manhattan.

Mr. Cullman, who also had homes in Manhattan; Jamaica, West Indies; and New Brunswick, Canada, is survived by his wife of 73 years, the former Louise Bloomingdale, of the department-store family; his son Edgar Jr., who was later president of General Cigar; two daughters, Lucy Danziger and Susan Cullman; a brother, the financier Lewis B. Cullman, who is often described as the father of the leveraged buyout; six grandchildren and three step-grandchildren; and six great-grandchildren.

Mr. Cullman, who enjoyed good cigars in general and, his son said, Macanudos in particular, came to cigar smoking rather late, all things considered.

“My grandfather bribed me that if I didn’t smoke or drink by 21, he would buy me a car,” Edgar Cullman told Cigar Aficionado magazine in 1994. “He died when I was 20. I never got the car.”

Article source: http://feeds.nytimes.com/click.phdo?i=4998058502e7106d2a05719cced5078e