The Superintendency of Companies gave his endorsement for WOM Colombia to enter the reorganization process.
Billy Escobar, Superintendent of Societies, had reported that the company needed an injection of close to $400,000 million.
The official had indicated that a technical concept was needed before admitting the applicant, which asked to be accepted recently and after the Chilean arm took advantage of the Bankruptcy Law in the USA.
From the company They had assured that this did not imply liquidation and operation in Colombia would continue.
WOM must present a plan to reach an agreement with creditors and, based on this, try to remain active in the market.
The company began operations in the Colombian market since 2019 and In the five years it has been active it has invested close to US$21 billion.
In mid-April, Thor Bjorgolfsson, WOM’s largest shareholder, had a meeting with the ICT minister, Mauricio Lizcanoto find alternatives and solutions to the financial and liquidity crisis facing the company.
“The Government wants the company to continue, business reorganization is a very important mechanism for companies to save themselves. Let’s hope that this process allows it not to die, we already did it in the past with Tigo, which we helped save. Of course It is worrying that they will enter into that process, but it will help them to have some time, obtain funds and continue in the market,” said Minister Lizcano.
The report for the fiscal year corresponding to 2023 is not yet publicly known, but if the company’s results for the immediately previous year are taken into account, it can be seen that cIt erred with an equity of $79,821 million and a debt that was around 35.72%.
In Inside LR, Ramiro Lafarga, CEO of WOM Colombia, had said that they would reduce losses in 2023 compared to 2022. The executive added that There was a delay in the payment that the parent company was going to inject, which was $84 million, but of which only US$16 million arrived.
By 2023, WOM Colombia had around 5.7 million users and a projection of reaching between eight and 10 million by the end of this year. But although it increased in users, it did not find financial equilibrium.
Ilva Restrepo Arias, partner at RA Consultoría Legal SAS, explained that “andThis reorganization process seeks to preserve the companies as a viable going concern and makes it possible for any executive collection to be suspended during the negotiation of the agreement, thus giving the businessman a break while the operational, administrative, asset and liability restructuring is carried out.”
The Supersociedades reported that, on the occasion of the beginning of the bankruptcy processcreditors must present their credits to the designated promoter and to the Superintendency, so that the Bankruptcy Judge at a hearing approves the total of the liabilities that will be subject to restructuring, as well as the inventory of the company’s assets.
WOM indicated that they hope to meet their obligations with the resources generated by their operationas well as the investment they achieve with the support of Deutsche Bank.
The Superintendent of Companies pointed out that “hand in hand with the Ministry of ICT and the Ministry of Commerce, the Superintendency will accompany this business rescue process with a view to maintaining the services offered by WOM.”
The official also noted that “lThe company is up to date with its labor obligations, and it is not in a situation of default, since it is a preventive action that allows safeguarding the viability of the business.”
