Brake on Deportivo Cali reorganization agreement: process, at risk

A new obstacle presented itself this weekend in the process that tries to save Deportivo Cali, which is experiencing a serious administrative and sporting crisis. The members’ assembly had approved, on April 27, that the club become a public limited company.

With a liability of more than 100 billion pesos, The team is urgently looking for a formula that will allow it to remain in competition and overcome a calamitous present in football, in which the professional team is fighting not to fall to the second division.

“With 93% of the votes in favor, the beginning of the conversion process to a Public Limited Company was approved,” Deportivo Cali explained at the time on their social networks. The team is the only one that maintains its social base, unlike the rest of the clubs participating in the FPC.

However, a lawsuit against the process could undo everything that had been advanced in the process. The 15th Civil Judge of the Cali Oral Circuit declared inadmissible the action with which the reorganization process began, as revealed by the Smoke-Free Zone.

The six points that Deportivo Cali must meet

The document, published on social networks, revealed that the judge speaks of “non-compliance with 6 points set out in the document that require clarification and to be corrected within a maximum period of 10 days, under penalty of rejection.”

Among the points are the absence of proof showing the capacity to sign the reorganization agreement and the existence and legal representation. Nor is it described what the mechanism for normalizing pension liabilities will be like.

Nor was there, according to the judge, provided a certification stating whether there are “differences or controversies that the debtor is aware of that exist in relation to the nature, amount and vote of all the creditors.”

The judge also requested a certification of the way in which the creditors were communicated about the beginning of the negotiations and about the existence of collateral assets. The fact of proving that the club is up to date with pension allowances was also not met.

In addition, the club was required to submit financial statements for the year prior to the request as well as the most recent month as possible. “Almost 6 months have passed by the time this office is aware of them,” the document says.

If Deportivo Cali does not present this documentation in the next 10 days, the process will be rejected.

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