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Agricultural Bank of China provides $25.5 million loan to Cimento Tupi S.A. for the Pedra do Sino Cement Plant Expansion Project
| Funder | Agricultural Bank of China (ABC) |
|---|---|
| Recipient Organization | Cimento Tupi S.A. |
| Country | Brazil |
| Start Date | Jan 08, 2013 |
| End Date | Aug 03, 2033 |
| Duration | 7,512 days |
| Number of Grantees | 1 |
| Roles | Recipient |
| Data Source | AidData Chinese Aid |
| Grant ID | 60363 |
Grant Description
Agricultural Bank of China provides $25.5 million loan to Cimento Tupi S.A. for the Pedra do Sino Cement Plant Expansion Project On January 8, 2013, the Agricultural Bank of China (ABC) and Cimento Tupi S.A. -- a Brazilian cement and concrete products company -- signed a Sinosure-backed, $25.5 million facility (loan) agreement for the Pedra do Sino Cement Plant Expansion Project.
It was backed by a Sinosure credit insurance policy and a security over a fixed deposit account.
The borrower was responsible for make semi-annual, principal payments beginning on August 20, 2014 and semi-annual, principal payments beginning on February 20, 2013. The loan's principal amount outstanding was $20,198,109.71 as of December 30, 2020.
The purpose of the project was to build a second production line at Cimento Tupi's Pedra do Sino cement plant in Carandaí.
In 2013, the nominal production capacity of Pedra do Sino cement plant increased from 3,000 tons to 6,500 tons per day after Cimento Tupi started clinker production in the 2nd production line of the plant in Carandaí.
However, there are multiple indications that the ABC loan financially underperformed vis-a-vis the original expectations of the lender.
The borrower (cement producer) struggled financially due to a downturn in the cement sector since 2014 and currency depreciation (i.e. depreciation of the Brazilian real against the U.S. dollar).
The borrower also missed principal and interest payments to ABC that were due in August 2015, February 2016, August 2016, and February 2017. Its lenders launched legal action in April 2019 after the company defaulted on around $30 million of loan repayments.
Then, in January 2021, Cimento Tupi filed for so-called preventative bankruptcy to deal with $627 million of outstanding debt.
Staff Comments
1. For loan and debt rescheduling records with variable interest rates, AidData calculates the all-in interest rate at T0 based on the reference rate (such as LIBOR or EURIBOR) on the loan start date, plus any known margin. Please see the methodology for additional details. For this record, the interest rate was according to the Cimento Tupi S.A. Financial Statements for December 2013 (pgs 35, 36, 51)
Sources & References
- Financial Statements - Cimento Tupi S.A.
- Individual and Consolidated Financial Statements
- BrazilCentralBank_September102018
- Relatório De Revisão Sobre As Informações Contábeis Intermediárias Individuais E Consolidadas
- JUDICIAL RECOVERY PLAN OF CIMENTO TUPI S.A.
- José A. Cobeña Serrano
- PLANO DE RECUPERAÇÃO JUDICIAL DA CIMENTO TUPI S.A. – EM RECUPERAÇÃO JUDICIAL
- Cimento Tupi Apresentacao de novo PRJ
- RELAÇÃO NOMINAL DE CREDORES DA RECUPERAÇÃO JUDICIAL DA SOCIEDADE CIMENTO TUPI S/A
- Cimento Tupi files for bankruptcy
- Cimento Tupi S.A. - Under Court-Ordered Reorganization Interim financial information, 1º RELATÓRIO MENSAL DE ATIVIDADES – RMA DE CIMENTO TUPI S/A EM RECUPERAÇÃO JUDICIAL, 3º RELATÓRIO MENSAL DE ATIVIDADES – RMA DE CIMENTO TUPI S/A EM RECUPERAÇÃO JUDICIAL Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.
All Grantees
Cimento Tupi S.A.
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