Santa Bárbara’s battle with Indra threatens credit of greater than 14,000 million to the protection business | Economy | EUROtoday

The judicial battle that Santa Bárbara Sistemas (SBS), owned by the American big General Dynamics, is waging with the businesses Indra Sistemas SA and Escribano Mechanical & Engineering (EME) threatens to cancel credit for greater than 14.4 billion euros granted to the Spanish protection business and paralyze the weapons packages which have allowed it to succeed in 2% of GDP in army spending in 2025.

On December 17, SBS introduced a contentious-administrative enchantment towards Royal Decree 915/2025, accredited by the Council of Ministers on October 14, which granted credit at 0% curiosity charged to the Ministry of Industry and Tourism for the event of Special Modernization Programs (PEM) of the Ministry of Defense. Specifically, it requests that the granting of loans value 3,002 million be canceled for Indra and EME to develop the brand new self-propelled artillery (ATP) packages on wheels and chains for the Army, with the argument that SBS “has not even been invited to the negotiated procedure without publicity or competition” processed by the Ministry of Defense for the award of future howitzers; regardless of being, in his opinion, “the leading company in the Spanish industry dedicated to the manufacture of ground combat vehicles” and Indra and EME missing “experience, resources or equivalent products.”

SBS’s goal was to restrict its problem to sections e) and f) of article 3.1 of the decree – that’s, people who designate Indra and EME as beneficiaries of the credit for the ATP Ruedas and ATP Cadenas packages – rejecting the looks of another firm within the case. However, the Administrative Litigation Chamber of the excessive court docket has rejected this declare and has made it clear that “the result of this appeal may not only affect the aforementioned beneficiary entities. [Indra y EME] but also to the interests of the remaining entities included in said norm.”

For this motive, in an order dated January 28, the Court has granted the standing of co-defendants to 2 subsidiaries of the Telefónica group (Telefónica Ingeniería de Seguridad SAU and Telefónica Soluciones de Informática y Comunicaciones de España SAU), beneficiaries together with Indra of a credit score of 380 million for the event of the Multidisciplinary Connectivity (MC 3) program.

To attain this conclusion, the excessive court docket alleges that the American multinational consists of among the many causes for difficult its enchantment the omission of the method of issuing an opinion by the Council of State, necessary though not binding; which, he explains, “could affect the entire Royal Decree 915/2025.” That is, if the Supreme Court dominated in favor of SBS, it must annul all the decree and never simply the paragraphs that the appellant sought.

The downside, underlined by authorized sources consulted by EL PAÍS, is that the dearth of an opinion from the Council of State is a defect suffered by the seven decrees that the Council of Ministers accredited between September and November of final 12 months, wherein credit for greater than 14.4 billion euros have been granted to quite a few army industries for the event of the brand new Special Modernization Programs (PEM) of the Ministry of Defense. If the Supreme Court concludes that the dearth of a report from the Council of State is enough trigger for the annulment of RD 915/2025, the identical sources warn, the Council of Ministers ought to annul the remaining six decrees ex officio or, at the least, a scenario of authorized uncertainty can be generated for the awarded corporations, uncovered to anybody who considers themselves harmed by the granting of those loans might problem them based mostly on the jurisprudence of the Supreme Court.

Among the beneficiaries of the loans from the Ministry of Industry are all the big corporations within the Spanish protection sector, resembling Indra, Navantia or Airbus; and even Santa Bárbara itself, which has acquired a mortgage of 176 million for the modernization of the Pizarro fight autos. Sector sources warn that the cancellation of the loans would have the speedy impact of paralyzing the brand new army packages, because the affected corporations lack the big funds essential to undertake the investments they want.

It will not be attainable to foretell when the Supreme Court will challenge its ruling, the identical sources clarify, but it surely should quickly rule on the request to droop the granting of credit to Indra and EME whereas the case is being investigated, which SBS has requested as a precautionary measure, arguing that the supply of those funds to its rivals would trigger “irreparable harm” and would produce a “loss of State resources”, since, it maintains, the technical different provided by the 2 Spanish corporations is “apparently unviable.” At the second, SBS has acquired a setback when the Supreme Court refused to permit the Christmas holidays to speed up the processing of the enchantment.

This lawsuit is the primary line of assault by General Dynamics European Land Systems (GDELS), the European subsidiary of the American big, towards Indra. The multinational has introduced that it’s going to additionally enchantment the award of the 2 ATP howitzer packages by the Ministry of Defense, whose complete worth, 7,450 million euros, greater than doubles the quantity of the assigned credit. In the background of this litigation is the Government’s dedication to constructing a champion of the Spanish protection business able to negotiating as equals with its European counterparts, a job till now attributed to Indra; and the choice of the present administration of this firm to launch a land automobile division in open competitors with SBS, which till now had loved virtually a monopoly on this sector.

After failing in its try to purchase Santa Bárbara, Indra has launched an operation to accumulate EME, the household enterprise of the corporate’s president, Ángel Escribano, and his brother Javier, regardless of the resistance of some minority shareholders, resembling SAPA, which has teamed up with General Dynamics to provide autos to the US Army, and the final minute doubts in SEPI itself (State Company of Industrial Participations), the bulk companion with 28%.