Yanina Otero 
Agricultural company Los Grobo group’s half-year financial results have placed its financial dire straits in the limelight. The report, which covers the six months through December 2024, reveals that Los Grobo Agropecuaria and Agrofina, the holding’s main two companies which filed for a legal moratorium earlier this month, lost over AR$42.7 billion (US$40 million at the official rate, US$35,4 million at the MEP rate).
Perhaps the most alarming revelation is that Los Grobo Agropecuaria has net negative assets, placing the company on the verge of dissolvement according to Argentina’s General Companies Law. In the last semester of 2024, the company reported AR$318 million in revenue, but the combination of high costs, operational expenses, and an elevated financial impact led to net losses of AR$26 billion — almost four times the losses they reported in the second half of 2023.
This plunge has further deepened its solvency crisis: its total liabilities are AR$333 billion, while its assets are around AR$320 billion, leaving it with net negative assets of AR$13 billion.
Argentina’s General Companies Law 19,550 states that a company can be dissolved if its net assets fall below half the value of its total capital. In this case, net assets are negative, meaning that it owes more than it owns. The company is now in an illiquidity trap, with financial obligations vastly outweighing its short-term payment capabilities. Furthermore, the legal moratorium it requested offers it few options.
The holding’s agrochemical firm, Agrofina, also ended last semester in the red. Although it billed AR$47.6 billion, it finished the year with a net loss of AR$16 billion due to its elevated sales costs and financial expenses. The company’s total assets amount to AR$188 billion, while its liabilities are almost AR$180 billion. Of this total, AR$163 billion is due in short-term debts. Although its assets were still a net positive of AR$8,3 billion, the company no longer had enough liquidity to face its more immediate deadlines, placing it in a very delicate situation.
A rough year
Los Grobos’ report says the financial decline of the companies is not new, but rather the result of a combination of factors that have impacted their business. The agricultural sector had a rough year in 2024, with international prices dropping, a sharp contraction in product demand, and an increase in financing costs following the December 2023 devaluation.
In the case of Los Grobo, the drop in soy and wheat prices affected grain sales. For Agrofina, the agricultural crisis caused the sale of agrochemical products to fall, while supplies remained costly.
While these factors took a harsh toll on their balance sheets, the final straw came in December, when Los Grobo Agropcuaria and Agrofina defaulted on their debt. The two companies were unable to keep up with payments of their short-term debts (known as a pagaré bursátil) nor with bank loan deadlines, accumulating debts estimated to be over US$200 million. The lack of a deal with creditors and the impossibility of refinancing their financial commitments led both companies to file for a legal moratorium on February 3 in an attempt to restructure their debts and avoid bankruptcy.
Despite rumors of a possible association between Los Grobos and other important players from the agricultural sector in order to stay afloat, there is nothing concrete at the moment. Multinational corporations are facing profitability challenges of their own, leading them to evaluate any commercial or investment decisions with the utmost care. Investment fund Victoria Capital, the majority shareholder of Los Grobo, has decided to cut its losses and is using the legal moratorium to resolve the matter in a way that is least detrimental to its finances.