Duro Felguera and its descent into hell: "Ten engineers leave us every week."

The value of Duro Felguera's assets of more than €1 billion back in 2010 is long gone. A decade and a half later, amidst a series of lawsuits, bailouts, and breaches of contract, such as that of the combined-cycle plant in Djelfa in Algeria, this Asturian engineering company—which was one of the first Spanish industrial companies to list on the stock market—is now worth less than €50 million and is preparing to undertake a severe redundancy plan (ERE) that will affect several of its companies and plants, which employ around 699 people, just under half of a workforce of around 1,500. "This is an inevitable and necessary measure to ensure the continuity of the company," said the company's CEO, Eduardo Espinosa, at the general shareholders' meeting held on June 27, where the audience was eagerly awaiting the meeting. He wanted to hear about plans for exiting the pre-bankruptcy proceedings that Duro Felguera has been in since December.

Negotiations with the unions, which were scheduled to begin this Monday, will not begin until Tuesday or Wednesday, according to various sources consulted. "What we want to know, above all, is what the industrial plan is, what the Duro Felguera of the future will be, something for which we believe a greater capital contribution will be essential," union sources told this newspaper, referring directly to the company's main shareholders, the Mexican group Prodi and the Portuguese Mota-Engil. Duro's plan involves implementing a collective redundancy plan (ERE) in all its companies and factories, except for El Tallerón, which will be sold to Indra, and Mompresa, a group company specializing in the manufacture and maintenance of turbines for hydroelectric and combined-cycle power plants. The company's objective is to "eliminate unprofitable business lines," adjust internal capacities, and strengthen "the units with the greatest potential," according to Espinosa himself at the meeting.

The company has reached this ERE after months of negotiations with its creditors, primarily the State, through SEPI , which rescued it with €120 million in 2021. Duro Felguera attempted to convince SEPI to transform this loan into capital, which would have effectively meant the government taking over the Asturian company. This did not happen, but Espinosa's team did score achievements during this time, such as getting rid of the €413 million burden posed by Algeria's litigation with Sonelgaz over the aforementioned Djelfa plant.

This event was the final straw that pushed Duro into pre-bankruptcy proceedings , a situation it hopes to emerge from this month following the collective redundancy plan. The firm's staff reductions, however, have been going on for longer. According to union sources: "We lose about ten engineers per week." The company counters that the sector in general suffers from serious problems recruiting staff and that there is high turnover between companies. "Turnover occurs when the flow of staff is in both directions. When they just leave, that's called a brain drain. Many have gone to TSK [another Asturian engineering firm]," the aforementioned union source responds.

The truth is that Duro Felguera has been able, despite the pre-bankruptcy process, to move forward with projects such as the Aboño thermal power plant, which Duro has transformed from coal to a mixed solution of natural gas and green hydrogen. This, moreover, has been done ahead of the agreed deadline and within budget, something Espinosa emphasized to shareholders who have seen the company's value go through a roller coaster ride that, so far this year, has resulted in losses of almost 18%, leaving its value at €0.22 per share.

Indra for El Tallerón

What is a fact is the sale of El Tallerón to Indra , whose main shareholder is SEPI, with a 28%. The company chaired by Ángel Escribano has everything agreed to acquire the Asturian plant, which enjoys a privileged access to the Cantabrian Sea. The agreement between the parties will close at 3.6 million euros, as El Comercio reported, to which must be added the cost of maintaining the 156 people who work at El Tallerón, according to various sources close to Duro Felguera and Indra.

Escribano thus achieves its goal of providing Indra with a location where it can begin producing both track- and wheeled military vehicles as quickly as possible. The executive, who took over as president of Indra in January following Marc Murtra's departure to Telefónica , previously attempted to acquire Santa Bárbara, but the American company General Dynamics (GDELS) refused to sell it, leading him to opt for Plan B of El Tallerón . This factory will not only be the production center for Indra Land Vehicles, its military vehicle branch, but will also foreseeably produce for Tess Defence, a company in which Indra now controls 51.01% of the capital .

The remaining partners (Sapa, Escribano Mechanical & Engineering and GDELS itself) reduced their stake following a €107 million investment by Indra, which decided to take the step forward following the problems Tess had in delivering the 8X8 Dragon armoured vehicles, for which the Ministry of Defence paid €2 billion in exchange for 348 units.