Pescanova’s debt pile – €70m loss when farmed turbot died

DEEP WATERS: Creditors meeting called.

FISH-PROCESSORS Pescanova are in deep waters, having launched a voluntary creditors’ meeting. Many of its €1.5 billion problems centre on millions of turbot that died at two fish farms in Portugal, chairman Jose Fernandez de Sousa admitted.

The company fished worldwide, using the same freezing technology as the meat industry.  It became a household name but aquiculture has triggered its present troubles. 

The Portuguese disasters were caused by defects in hydraulic systems for collecting sea water and accounted for losses of €70 million.  Confident that they would be covered by insurance, the company did not inform shareholders.

Meanwhile two shrimp farms in Ecuador have been sold while increased production of cohu salmon in Chile coincided with a catastrophic slump in the Japanese market.

Pescanova claimed all along that all was well. Nevertheless, De Sousa secretly sold half of his 14 per cent holding between last December and February. The €31.5 million proceeds were to solve liquidity problems, De Sousa insisted.  

In fact he lent Pescanova €9.3 million for three months at 5 per cent interest, the company has revealed.

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