Homebuilder AST’s backup plan rejected

This plan, which was supposed to avoid the cessation of payments, was rejected by the creditors.

The accelerated backup plan project proposed by the individual house builder AST has been rejected by its creditors, the group, whose future is more compromised than ever, declared on Monday 22 July.

“The judicial administrators of the AST Group have informed that the draft safeguard plan has not obtained the necessary majority to be validated by the categories of interested parties and cannot be examined by the commercial court,” AST explains in a press release.

“AST Group deeply regrets the outcome of this vote and is working with its advisors and procedural bodies on the actions to be taken following this decision. The group will keep its employees, customers, partners and shareholders informed of the next steps,” the manufacturer continues.

Based in Décines-Charpieu (Rhône), in the metropolis of Lyon, AST announced in April the opening of a accelerated backup procedure at the commercial court of Lyon.

The aim was to allow the establishment, following a conciliation procedure with financial creditors (guarantors, banks, public institutions), of a plan to avoid the cessation of payments. But this plan, during which AST could continue its activity, had to be approved by a sufficient number of these creditors, which did not happen.

A “significant reduction in the workforce” already foreseen

Earlier this year, AST had already announced a major restructuring plan that included phasing out its development business and refocusing its homebuilding business in the Southeast.

“In the absence of a favourable outcome to these discussions (with its creditors, ed.), the continuation of the Group’s activity could be called into question”, AST warned at the time.

The company also announced a “significant reduction in its workforce.” At the end of 2022, it employed about 590 people, the last public figure to date.

AST, which presents itself as the second French builder of single-family homes, is suffering, like other builders and developers, from the violent crisis of new real estate, caught between the increase in construction costs and the loss of purchasing power. Its listing on the stock exchange has been suspended.

Leave a Comment