Miguel Lamo de Espinosa analyses the rise of debt purchases following the Celsa case | El Confidencial

Miguel Lamo de Espinosa, partner at Gómez-Acebo & Pombo, notes that an increasing number of funds are looking to acquire debt from companies facing financial difficulties, with the aim of later converting it into equity or intervening in the company.

Specialist debt vehicles and some private equity funds are increasingly interested in taking positions in companies with complex financial situations, with the possibility of converting that debt into equity following a restructuring. The strategy, supported by the insolvency framework introduced in 2022, allows intervention before companies enter pre-insolvency, preserving their long-term sustainability and avoiding blockages from shareholders or creditors.

According to Lamo de Espinosa: “Fundamentally, the interest is in credit funds or special situations. Private equity funds show interest, but it is harder for them to enter these types of situations. It is a process of education: this is not about buying distressed companies, but buying healthy companies within a distressed process. The difference is considerable.”

The Celsa case was emblematic: bondholders capitalised debt despite opposition from shareholders and took control of the company. Other recent examples include Naviera Armas, Telepizza, Ezentis, and Mr. Wonderful. The trend is consolidating while traditional M&A activity remains stalled, and venture capital funds are beginning to explore this path as an alternative way to generate value and future returns.

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