Brussels, 01/02/2001 (Agence Europe) - The Commission has closed its investigation into aid granted between 1993 and 1995 by Spain to the fertiliser manufacturer Fesa-Enfersa (re-named Fertibeira) with a positive response. The investigation began on 19 May 2000. The 151 million euro aid has been declared compatible with the guidelines for State aid for the rescue and restructuring of ailing companies.
The affair began in December 1992, when Fesa-Enfersa had filed for insolvency in the context of extremely adverse market conditions in the European fertiliser market. Spain had then granted the company aid in the form of several subordinate loans awarded by State-owned Instituto de Credito Oficial., without notifying this to the Commission. It was only a few years later that the Commission became aware of its existence, when examining State aid in favour of Ercros, main shareholder of the fertiliser manufacturer. In 2000, it had then initiated a formal examination procedure, following several exchanges of letters with the Spanish authorities. At the end of its investigation, the Commission noted the existence of a solid restructuring plan enabling the company to recover its long-term viability. In addition, the cost of the restructuring being fairly high, it was hardly possible for Fesa-Enfersa to pocket the surplus cash, and the new private investor made a significant contribution to the restructuring plan. These conditions were essential to enable the Commission to provide its approval, which it has done retroactively.