The investment fund Argentem Creek Partners, based in New York, reported that the Kickapoo Tribe of Texas accepted its invitation to invest in the paralyzed steel company Altos Hornos de México (AHMSA).
“The Kickapoo Tribe has expressed its intention to participate in this (capitalization) process, due to the importance of AHMSA in northern Mexico as a key source of employment for the state and the region,” Argentem Creek Partners reported in a press release.
Argentem and the Kickapoo investors are "negotiating a binding agreement to make the financing available for the essential purpose of restarting AHMSA's operations."
Information sources related to the process told SteelOrbis that at the time the participation of these investors was finalized, the working capital initially committed by Argentem Creek in March for $200 million for working capital to reactivate AHMSA's production. The agreement for the sale of the controlling share package of the steel company was signed on March 15.
The source consulted said that when the participation of Texan investors is completed, the amount of investment will be "quite" greater. AHMSA, with a production capacity of 5.5 million metric tons of steel per year, has been paralyzed since the beginning of the year due to insolvency.
Argentem indicated that the additional injection (Kickapoo Tribe) of capital to AHMSA will be available until (1) the parties sign the necessary documentation to structure the operation, (2) the signing of the contracts is approved by the competent judge, and (3 ) the conditions are met to ensure, among other things, that (a) AHMSA can operate as a going concern and generate monetary resources to meet its financial needs (b) the power and electricity supply is restarted, (c) the installation of the new board of directors, and (d) the exercise of the corporate rights derived from the shareholding is adjusted to the purposes of restarting the operation of AHMSA focusing on its main business.
Until now, the progress to restructure the up to MXN 5.0 billion ($285 million of dollars) of AHMSA's debts with the federal government is unknown.
The Kickapoo Traditional Tribe of Texas (KTTT) is one of three federally recognized Tribes of Kickapoo people. The reservation is located by the Rio Grande on the US-Mexico border in western Maverick County.
These investors already have heavy machinery, nutrition centers, and other businesses in Mexico. At the moment the size of these investments in Mexico is unknown.