In the month of June 2003, Industrias CH, S.A.B. de C.V. (ICH) held with different banks, that are currently in bankruptcy procedures, through Administradora de Cartera de Occidente S.A. de C.V. (ACOSA), agreements of assignment of legal rights with a shared recovery of 50%. These accounts receivable included commercial loans with Grupo Industrial NKS, S.A. de C.V. and several companies of the Covarrubias Valenzuela family.
On December 11, 2003, Industrias CH sold 99% of its shareholding in ACOSA to its subsidiary, Grupo Simec S.A.B. de C.V. (SIMEC), and SIMEC sold the same shareholding on October 9, 2006 to Holding MM, Inc., so from that date ACOSA has been a spin off of SIMEC and ICH.
During the time that ACOSA belonged to the group, the company carried out various actions with its debtors in the portfolio that was assigned to ensure its recovery, among these actions, the restructuring of all claims by the companies of the Covarrubias Valenzuela family. Given the failure of a new agreement with the Covarrubias Valenzuela family, ACOSA undertook various legal actions against them and one of their companies, MOTORMEXA, S.A. de C.V. In one of these trials, the sentence ordered them to pay the capital and accrued interest, which at this date is approximately over $300 million dollars, and caused the order's execution.
We understand that the situation presented in this trial has led to Covarrubias Valenzuela family to try, through various means, to stop the execution of this sentence. Even criminal proceedings against the President of the Board of Directors of ICH and SIMEC, which are totally improper, have been made public in print and electronic media in a willful form.