2023-05-27 04:19:54
It is the beginning of a definitive peace agreement
On March 31, the former president of Bancolombia, Carlos Raúl Yepes, took the microphone at the extraordinary assembly in Sura to implore an agreement between the GEA and the Gilinskis, led by Jaime, the son of Jewish immigrants born in Cali. “This war must be stopped,” he said.
There were seven takeover bids (OPA) that the Gilinskis launched supported by the bulging checkbook of their partners in the United Arab Emirates. Three hostile takeover attempts by Nutresa, three by Grupo Sura and one by Grupo Argos. And then, a legal war broke out in the regulatory entities and even in the civil and criminal courts. In addition, a media smear campaign from the Gilinski Week magazine once morest Antioquian managers.
The agreement announced yesterday is a key step to stop that war. And each of the parties gave up important honor points.
Antioquenos, on the one hand, are seeing the fall of their historic cross-ownership scheme, established in the 1980s, precisely to prevent the assault on their large companies by outside capital. And they do it by delivering Nutresa, the food multilatina that also represents the industrial origin of their business networks.
“The National Chocolate Company was the initial seed of Nutresa. It is the origin of the castling of the GEA”, says the economist Javier Mejía, studious of the business elites of Antioquia.
For their part, the Gilinskis renounce what was, apparently, their main motivation: to control Bancolombia, the largest bank in the country, and whose main shareholder is Sura, from where they must leave due to the agreement. “They are businessmen and on this path they were not going to achieve their objective. Hopefully this war has definitely stopped” says Yepes, former president of Bancolombia.
And although there are still many details and operations to be resolved, including the approval of the regulators, the economic groups avoid the tortuous legal path that they traveled in the nineties during the conflict over the Grancolombiano Group and that was already being warned once more.
The agreement avoids judicial and corporate bloodshed
For now, the deal dodges the legal give and take of a wrestling in the markets that quickly escalated into a bitter legal battle.
In November 2022, in the middle of one of the OPAs, a judge accepted a civil lawsuit once morest members of the board of directors of Grupo Sura who represented the Gilinskis. Subsequently, the Prosecutor’s Office opened a criminal investigation to determine if that judge had acted illegally.
Then, over 10 days, in March 2023, the Gilinskis launched the final round to seize the administrations of all three companies.
The bankers tried, through an appeal before the Superintendence of Companies, to block the vote of the representatives of Sura and Argos in the formation of a new Board of Directors of Nutresa.
The Supersociedades favored the bankers’ request and made the express approval of the shareholders of both groups a condition for lifting the blockade. This caused a cascade of extraordinary assemblies that finally, and in the midst of mass demonstrations and hostile meetings, left them dead.
Faced with this dead-end conflict, only the path of judges and regulators remained.
For the GEA, it might mean being declared by the Supersociedades and Superintendencia Financiera as an economic group. This measure, promoted by the Gilinskis, would put them at a disadvantage by affecting their ownership structure and their negotiating position. And the arrival of César Ferrari, the new superintendent appointed by President Gustavo Petro, who had rapprochements with the Gilinskis when he was a congressman, made him even more noisy.
“It is likely that the agreement was driven by the decisions of the superintendencies. It is a smart decision for the size of the business. And if one wanted to be misconstrued, one might say that it was accelerated by the fact that the superintendent is closer to Petro, ”an official from the Financial Superintendence told La Silla, who requested that his name be reserved.
The GEA, however, also pulled the legal levers. And at the time, through Nutresa, he filed a criminal complaint once morest the officials of the Supersociedades who distributed and failed the precautionary measures presented by the Gilinskis in March.
Then in April, the battery of lawyers close to Gilinski returned fire. Jaime Lombana, criminal lawyer and brother of Ximena Lombana, one of the Gilinski delegates on the Grupo Sura board of directors, filed a criminal complaint once morest the company’s senior management.
To avoid imminent and uncertain injuries from this legal battle, in publicly traded companies, the Gilinskis’ Arab partners played an important role.
The Arab partner weighed more than the Gilinski story with the GEA
The International Holding Company (IHC), owned by Sheikh Tahnoon bin Zayed AlNahyan, set Nutresa as its main objective to land in Colombia. And together with the bankers they will obtain no less than 87% of the shares, achieving their objective.
“They are the big winners of the agreement. Nutresa was the component of the business that they were most interested in controlling. They have very specific interests in the food sector”, says the economist Mejía.
Since the first takeover bids, the Abu Dhabi fund – linked to the United Arab Emirates royal family – has lent the Gilinskis money to execute them on the stock market. And they also own half of Nugil SAS, the firm that currently owns 31% of Nutresa’s shares.
But in addition to the public interest in the food multilatina, the Arab executives have played a role of fixing between the two Colombian groups.
Since December of last year, commissions of representatives of the cacao paisas have traveled to Abu Dhabi, the capital of the Emirates, to unblock the negotiations. This mediation and the interests of this foreign capital were more decisive than the conflicting history between the GEA and the Gilinskis.
In the nineties, Isaac Gilinski, Jaime’s father, today the head of the banking family, led the operation to sell the majority of the shares of Banco de Colombia to Banco Industrial Colombiano, of the GEA.
That merger was the origin of Bancolombia. But following disagreements over the operation of the bank, Gilinski Sr. embarked on a legal dispute that lasted more than a decade. “It was a revenge story. It is a point of honor that the Gilinski lose”, says the journalist Héctor Mario Rodríguez, editor of Primera Página.
Forever erodes the paisa castling
With the delivery of Nutresa, the cross-ownership scheme has fallen. Antioquia’s business elites, accustomed to the languor of a small and sluggish capital market, have been exposed to a bold player backed by a powerful foreign partner.
“The capital market in Colombia is strengthened by these operations. However, it is weakened by the smear campaigns, disinformation and systematic attack once morest the executives of the so-called GEA”, says the economist Martín Jaramillo, director of the Eafit Management and Business Center.
Without Nutresa, the economic vocation of the GEA now leans even more towards the service economy, favoring its businesses in the financial sector, organized in Sura. “It’s a bitter pill, but an intelligent one,” says a former Grupo Sura official who requested that his name not be used.
The castling is not completely broken. In terms of revenue, Nutresa was the smallest group in castling, with 17 billion pesos in 2022, below Grupo Argos ($21 billion) and Grupo Sura ($31 billion). These two groups still maintain their cross ownership and a new smaller castling.
But now, Nutresa, with its headquarters in Medellín, will have foreign owners. “It is a strong movement in the business world that definitely changes the game board. But you have to adapt to the new market rules,” says Yepes, former president of Bancolombia.
leaves many loose ends
The first of them in the regulatory field. The decisions of the Supersociedades and the Superfinanciera will continue to weigh on the GEA regarding the behavior or not of their conglomerates as a single economic group, now made up only of Sura and Argos.
“The legal discussion continues because there are still cross-shareholdings between Argos and Sura, which is a financial holding company. They are different businesses that have investments between them. There is something that remains as castling ”, says an official of the Financial Superintendence who requested the reservation of his name. There are also a series of operations remaining on the stock market, necessary to make the agreement effective, which the regulators must endorse.
But the people of Antioquia also have many questions ahead. Among them, the new property scheme between Sura and Argos. This is key to the extent that, on the one hand, it affects the governance of the companies and, on the other, it sends signals of the new focus of the business group now without Nutresa, its powerful industrial arm.
“The three legs of the table were not going to hold up once morest an offer with so much money behind it. And the GEA decided to strengthen two of those legs: Sura and Argos. The question is what are they going to do with the money that the Arab sheikh gave them in exchange for their participation in Nutresa. That is going to be key,” says Jaramillo.
Finally, there are the concrete effects of the arrival of the Gilinskis and the Arabs on the food conglomerate. In short, it is a company that generates close to 45,000 formal jobs in the country and enjoys great prestige among its workers.
Use: Bancolombia is currently financing a special for La Silla on the aging of the countryside and another on energy transition. Last year, Sura hosted a season of our podcast ‘Huevos Revueltos’.
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