In this exclusive interview, Loren Moss, Executive Editor of Finance Colombia, speaks with Cristina Zambrano Restrepo, the Executive Director of ACI Medellín. They discuss how the city nearly tripled its investment attraction over the past year, reaching over $400 million USD, and the strategies used to reassure international investors during a complex electoral landscape in Colombia.

Finance Colombia: I’m here with Cristina Zambrano Restrepo, the Executive Director of ACI Medellín. It’s always a pleasure to be with you. Thank you for the invitation. I know you’re extremely busy, so thank you for making the time to speak with Finance Colombia. How have you been?

Cristina Zambrano Restrepo: Very well, thank you very much. Truly happy to be here with you. Thank you for accepting this invitation. Without a doubt, we work to bring good and positive news to this city, and thank you for being here and for sharing and conveying all of these good things.

Finance Colombia: Yes, today you talked about the successes that ACI Medellín and the city have had this year in attracting investment. Tell us a bit about some of those successes. I think it’s going to be another large business hotel, and tell us a little about how you’ve kept busy.

Cristina Zambrano Restrepo: Of course. A major focus for us is job creation through investment attraction. So, what did we achieve this year? We went from USD 150 million generated last year to more than USD 400 million this year. As I’ve mentioned, this is reflected in the creation of more than 11,500 formal, high-quality jobs generated by this investment attraction. We have major allies and players here, such as Renault-Sofasa, Rivana Business Park, SoftServe, and POMA. A great deal of companies, some already established, others newly arriving in the region. TaskUs too, which is also extremely important and has made major commitments to us. These are the companies that manage to generate that employment.

Finance Colombia: Excellent, that’s fascinating. I have a history with Colombia of about 20 years, and here in Medellín of about 11 years, and it’s truly wonderful to see how the city has grown—not only in population, but in investment and innovation. However, we’re living in a time of high uncertainty around the world—not just in Colombia, not just in the United States, but globally. Especially when we talk about the sector, not in general terms, but politically and economically. Has this made attracting investment more difficult or more challenging over the past year? How has this affected efforts to attract FDI, like, foreign investment, and what strategies have you used to overcome this challenge?

Cristina Zambrano Restrepo: Here, clearly, the political landscape affects and directly impacts confidence, right? The stability of a region, how we present ourselves to the world and to those very large capital investments, showing that we are a stable region, that we believe in them, and that we will support them. So, what strategies do we have? Without a doubt, it has been very challenging. We would like, for example, to be able to offer a range of benefits, extensions, fast-track processes in permitting and such, but in that sense we depend heavily on the national government. But we don’t stop there. We work from the regional level and have a firm commitment locally, focusing on what we ourselves can support, contribute, and manage from this area, the private sector. Which also helped sustain the region during the previous administration, and the academic sector, all the universities, and that ecosystem, which have been fundamental. And now the public sector as well, we are all working together specifically from this region to demonstrate that we are a region that inspires confidence, offers stability, and has all the right conditions for investment to continue to arrive.

Finance Colombia: One thing you’ve mentioned that’s very important, and something Medellín is known for, is the collaboration between the private and public sectors. In many other places, without naming names, it’s an endless war. But in Medellín it has always felt like it’s everybody. That’s why Medellín has always had the Metro and continues to have major projects here, because the private sector has a strong sense of civic ownership. People talk about the GEA, but from a foreign perspective, what I’ve seen is that companies like Grupo Argos, SURA, Bancolombia, and more recently Nutresa, and many smaller ones that aren’t international names, have a sense of belonging and work hand in hand with the government. Speaking of that, for example, Mayor Federico Gutiérrez has traveled to the United States and other places to maintain those good relationships, despite what may be happening in Bogotá or at the Casa de Nariño. What is the importance of the efforts made by the metropolitan government and the city government of Medellín, not only at the ACI level, but also at the level of Alpujarra? How important is this in maintaining a long-term course so that foreign investors continue to see Medellín as a destination, no matter how much may be happening 400 kilometers away?

“We went from USD 150 million generated last year to more than USD 400 million this year… reflected in the creation of more than 11,500 formal, high-quality jobs.” — Cristina Zambrano Restrepo

Cristina Zambrano Restrepo: I think what you’re pointing out is fundamental, and it’s specifically how we’ve achieved this model in Medellín. In a way, when we go out into the world and explain how we work hand in hand, as you said, there are cities and countries that react like, “Why do we need to sit at the same table? I’m very clear about my purpose, and you’re very clear about yours.” Here, the real history of what this city lived through 40 years ago made all of us sit at the same table, and we realized that the efforts of the three actors are always aligned toward the same goals. What always matters to us is citizens’ well-being, quality of life, economic and social development, many things. So when we were going through our hardest moments, we managed to set aside egos, agendas, and competing visions. We sat down, we talked, and we’ve continued to work under that model ever since.

As for what’s happening and what lies ahead in the future: clearly, having a political leader like Federico Gutiérrez, with those strategies and international connections, matters greatly. Countries trust leaders who have demonstrated stability and very clear commitments throughout their governing trajectory, and that’s what our mayor has done. Because of that, they continue to seek us out as a region and want to work with us as a region. As we were just discussing, the investment world is very accustomed to government cycles, more than people might think. They know how to manage political and public-sector issues and how to make bold bets at certain moments. We work on this, and together with the mayor we focus on those countries where we need them to keep believing in us and trusting us. The United States is Colombia’s partner par excellence, that is not going to change. It is the largest market in the world. So the mayor’s strategy of being very close to that government, of working with a binational chamber like AmCham Colombia, which always helps us continue attracting investment and fostering exchanges, is exactly how we work hand in hand.

Finance Colombia: Well, you’ve been very generous with your time. Just two more questions. One is that in the United States, we have a saying: “Nothing happens before the elections.” That big companies are always waiting to see what’s going to happen, what’s going to unfold. Is it the same here in Colombia? I know in Colombia, even more than in the U.S., there’s a law—well, speaking of public contracting, where nothing can really happen. But aside from that, not talking about selling food to a school or something like that—do investors or multinational companies see this as a challenge? Are they ready to sign contracts, or are they waiting to see what happens?

Cristina Zambrano Restrepo: Of course, without a doubt it’s a challenge. And it’s not a minor one. It’s a challenge that forces us to work even harder to demonstrate, from the regional level, just how stable we can continue to be so that investment keeps coming. There are many companies that make their decisions regardless of the electoral period we’re in, largely because, as I mentioned, they know how to manage political risk. But there are certainly many others that are on pause, waiting to see what happens in the upcoming elections. So yes, in that sense, it does present significant challenges. Even so, we are still projecting USD 400 million for next year despite the elections, and we continue to work toward and commit to that goal. And regarding what you mentioned about contracting, specifically public-sector contracting; a city cannot come to a halt just because there is a law on guarantees, right? All of that is already anticipated. Contracts need to be signed and put in motion ahead of time. Everyone here knows how to operate during a six-month guarantees-law period, so everything has to keep moving and functioning.

Finance Colombia: The last question, I’ve known ACI, even from before I was living in Colombia. I’ve now been in Colombia for 12 years, and I’ve known Juan since I was living in Miami. They were always calling me, saying, “Look, come see what we have in Medellín. Come, let us show you something beautiful we have, or an investment opportunity here.” And that was truly a big part of why, when I was living in Bogotá, I decided to move to Medellín. It was exactly like that, maybe not as a major investor, but that attitude, that paisa pride.

Cristina Zambrano Restrepo: Paisa pride, yes, I was just going to say.

Finance Colombia: Exactly, exactly. Like my wife, who’s paisa, when we’re abroad and someone asks her, “Are you Colombian?” she says, “I’m paisa.”

Cristina Zambrano Restrepo: More than Colombian, I’m paisa.

Finance Colombia: What is the “secret hogao” of ACI Medellín? Because regardless of the government in power, regardless of what happens under your leadership, and even looking at the long term, what is the secret sauce behind the success ACI has had as an investment promotion agency? You have a strong global reputation in the FDI space, Foreign Direct Investment. You, as director, as someone who knows how the internal plumbing works, what is the key to the success ACI has achieved?

Cristina Zambrano Restrepo: Well, I think without a doubt it’s our long-term planning. It’s a vision we have for the city, a vision for the territory—a clearly defined commitment. Every time we come in, there’s no need to reinvent things; we need to keep working on what already works. We have a technical team, and this is something I really want to highlight: this is a highly technical organization. While it does, of course, depend on electoral and government cycles, it has a well-trained staff that has been working in these areas for many years, and thanks to them we’ve been able to maintain the stability this institution has. So I would emphasize that, in addition to what you mentioned about paisa pride—which is an identity that characterizes all of us from Medellín. We truly like to see our city doing well; we fight for it, we defend it, we work for it. That paisa pride ensures that everyone who passes through this institution clearly understands the vision and works toward it, regardless of how long they remain here.

Finance Colombia: Yes, it’s true—you have a world-class team, so I know they make your job much easier. Thank you very much for your time; it’s always an honor to see you and to speak with you, and know you can always count on Finance Colombia for anything.

Cristina Zambrano Restrepo: Thank you as well, truly, for being here and for always supporting ACI Medellín. Indeed, you and Finance Colombia have been great partners for us in continuing to share and convey all the news that’s happening.

Finance Colombia: We will, thank you.

The revised model delineates two primary functions within EPM. One segment of the organization now oversees strategic management across the 47 companies that comprise the Grupo EPM—which operates in Colombia, Chile, El Salvador, Guatemala, Mexico, and Panama—while the other focuses on direct public service delivery in Medellín and the department of Antioquia. The legal status and public ownership of EPM remain unchanged.

Administrative Adjustments and Workforce Impact

As part of the restructuring, EPM reduced its number of executive positions from 247 to 206. This change shortened reporting lines and flattened hierarchies in several departments. The company reports that 45 internal professionals were promoted to executive roles, and 21 department heads were elevated to higher-level positions.

The reorganization also includes the transformation of EPM’s existing Shared Services Center (CSC) into a proposed sub-management unit called “Global Business Services” (GBS). The GBS model, which is under internal review but not yet approved by the board of directors, aims to consolidate and standardize fragmented processes currently distributed across multiple departments.

GBS structures are widely adopted in multinational corporations for centralized service delivery. In Colombia, similar models are used by Grupo Argos (BVC: GRUPOARGOS, PFGRUPOARG), Grupo Nutresa (BVC: NUTRESA), Organización Corona, Grupo Aval (BVC: GRUPOAVAL, PFAVAL), and Grupo de Energía de Bogotá (BVC: GEB).

Strategic Objectives and Governance

The restructuring is part of EPM’s broader effort to enhance its governance framework and align its operational model with global trends in digital transformation, energy transition, and circular economy practices. The company has emphasized that the changes are not intended to split the organization but to clarify roles and responsibilities between corporate oversight and service execution.

EPM’s leadership team under General Manager John Alberto Maya Salazar includes newly appointed vice presidents across strategic, energy, water and sanitation, finance, regulation, and customer experience divisions.

Photo credit EPM.

• Issuance of Ordinary Bonds for COP $640,000 million
• Program for the Issuance of Ordinary Bonds and Commercial Papers for up to COP $3.0 trillion
• Program for the Issuance of Ordinary Bonds and Commercial Papers for up to COP $2.0 trillion

The Long-Term Rating Outlook is Stable. The short-term national rating for the Ordinary Bond and Commercial Paper Issuance Programs was affirmed at ‘F1+(col)’.

The upgrade reflects the anticipated strengthening of Cementos Argos’ capital structure and enhanced financial flexibility due to the use of USD1.2 billion from a transaction with Summit Materials for debt repayment. Fitch projects the company’s gross and net leverage to approach 2x by 2024. Despite reduced geographic diversification from deconsolidating its U.S. operations, Cementos Argos’ profitability, reduced financial expenses, and reallocation of capital to more profitable operations are expected to support operating cash flow generation. The company’s non-controlling investment in Summit Materials provides exposure to the U.S. market, contributing to its financial flexibility.

Key Rating Factors:

Strengthened Capital Structure: Cementos Argos received approximately USD$1.2 billion from its transaction with Summit Materials (NYSE: SUM), earmarked for debt repayment. By 2024, debt payments are expected to total COP4.7 trillion, reducing the company’s debt from COP6.9 trillion at the end of 2023. The reduction in debt is expected to lower short-term debt maturities, spread out long-term amortizations, and maintain leverage near 2x.

Lower Leverage: Cementos Argos’ net leverage was 2.4x at the end of 2023, supported by favorable operating results. The transaction with Summit Materials allowed for U.S. asset monetization and debt repayment. Fitch forecasts that leverage will remain close to 2x through 2024, supported by stable EBITDA and moderate debt requirements.

Geographic Concentration: The deconsolidation of U.S. operations has reduced the company’s geographic diversification, concentrating operations in Colombia and Central America and the Caribbean (CAC). These regions are expected to account for approximately 58% and 42% of EBITDA, respectively. While this increases exposure to regional economic cycles, the expected improvement in profitability, stable EBITDA, and stronger capital structure should offset the risks.

Financial Flexibility: The non-controlling 31% stake in Summit Materials provides exposure to the U.S. market and supports financial flexibility. Cementos Argos has implemented cost and productivity efficiency programs, which are expected to improve its cost structure and profitability.

Negative Free Cash Flow: Fitch projects that operating cash flow (FCO) will remain stable, averaging COP730,000 million annually from 2025. However, due to demanding dividend payments and share buybacks, free cash flow (FFL) is expected to remain negative, with a margin of approximately -4%.

Competitive Position: Cementos Argos remains a leading producer of cement and concrete in Colombia and Central America. The company holds significant market shares in Colombia, the Dominican Republic, Panama, and Honduras.

Rating Derivation:

Cementos Argos has a more robust business and credit profile compared to Ultracem, S.A.S. (rated A(col) with a Negative Outlook) due to its broader geographic presence and lower leverage. However, compared to Colombina S.A. (rated AA+(col) with a Positive Outlook), Cementos Argos’ business profile is more vulnerable to economic cycles, although this is partially offset by its stronger capital structure.

Key Assumptions:

• Deconsolidation of the U.S. operation in 2024 and investment registration via the equity method.
• Debt repayment totaling USD1.2 trillion, with USD700 million for U.S. debt and USD500 million for Colombia.
• Annual cement sales volume growth in the low single digits between 2024 and 2027.
• EBITDA margin near 22%.
• Average exchange rate of COP4,152 per USD1 for the projection period.
• Capex and dividend distribution aligned with management projections.
• Share buybacks between 2024 and 2026 totaling approximately COP450,000 million.

Rating Sensitivity:

Negative/Downgrade Factors:

• Net debt-to-EBITDA leverage exceeding 2.5x on a sustained basis.
• Liquidity levels below 1x.
• Equity investments or debt-financed acquisitions that weaken the credit profile.
• Dividend distributions or value extraction mechanisms that increase leverage and pressure FFL.

Positive/Upgrade Factors:

• Greater geographic diversification of EBITDA generation.
• Sustained net debt-to-EBITDA leverage below 2x.
• Liquidity consistently above 1.5x.
• Interest coverage above 6.5x.
• Positive FFL generation throughout the cycle.

Liquidity:

The transaction with Summit Materials has improved Cementos Argos’ liquidity by reducing short-term debt concentrations. The remaining debt is primarily in long-term bonds with amortizations spread over time. The company’s stake in Summit Materials, a New York Stock Exchange-listed company, also supports financial flexibility. Cementos Argos maintains uncommitted credit quotas of COP2.5 trillion.

Issuer Profile:

Cementos Argos is a nearly 90-year-old company specializing in cement, concrete, and aggregates production in Colombia and CAC. Following the integration with Summit Materials in 2024, the company deconsolidated its U.S. operations, which accounted for 55% of EBITDA in 2023.

Criteria Applied:

• Corporate Finance Rating Methodology (December 22, 2023)
• National Scale Grading Methodology (December 22, 2020)
• Parent-Subsidiary Rating Link Methodology (July 13, 2023)

According to the New York-based agency, Grupo Argos continues to show credit quality, overall “robust credit metrics” projections, and stability of dividend flows from its diverse investments, which are expected to hit nearly 978,000 million Colombian pesos this year.

“Fitch projects that recurring dividend flow will normalize from 2024 and continue to strengthen in the following years with the incorporation of higher dividends from Grupo de Inversiones Suramericana given the expected increase in Grupo Argos’ shareholding with the closing of the transaction,” stated Fitch in a note to investors. “Cash generation is also supported by the contribution of net cash flows from the urban development business.”

Fitch Ratings framed its decision to remove the “evolving watch” status as informed by the “progress of the transaction between the company and the companies JGDB S.A.S, Nugil S.A.S, International Capital Holding L.L.C, AFLAJ Investment L.L.C, Grupo Nutresa S.A. and Grupo de Inversiones Suramericana S.A., which has undergone several corporate and regulatory approvals.”

Dividend flows were also considered along with the “adequate liquidity position to meet the commitments arising from the exchange of Grupo Nutresa shares, without anticipating a weakening of its credit profile.”

Argos Cement Colombia (Photo credit: Jared Wade)

First off, Colombian President Gustavo Petro spoke at the United Nations, world peace and sustainability the main themes, although he did delve off into other areas. Overall little to report.

Lot of headlines about the Colombian peso being the global top performer in 2023. To reiterate, this isn’t outperformance — it is a snapback from the wonton erroneous selling in the fourth quarter of 2022.

Fedesarrollo published its financial survey for September. Overall, there were few radical changes but we saw inflation expectations for 2023 rise and, accordingly, overnight expectations are also higher.

Imports for July, according to National Administrative Department of Statistics (DANE), dropped by 28.2% year-over-year. A weak figure indeed — but as exports were weaker that generated another $600 million USD trade deficit for the month. The domestic slowdown in demand continues.

Camacol Nacional reported that new home sales fell 52.2% in August to 8,699 units, as interest rates continue to bite. For the same reason, household spending for August (per RADDAR CKG LATAM) dropped 3.2% to 82.4 billion Colombian pesos.

The reform process continues but there have been no real developments to speak to, simply more edging forward.

Nutresa shareholders, as expected, voted through the Gilinski share swap, and the market is awaiting this development, which includes Grupo SURA and Grupo Argos.

Lastly, the markets showed a little more volume this week, although equities have yet to catch the imagination locally.

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Here’s a summary of some of the key areas.

GDP Growth

Colombian GDP for 2023 saw the outlook rise from 1.1% to 1.5%, moving closer to the estimates of overseas agencies. Once again — despite opinion polls declaring we are heading for Armageddon — we see various stakeholders increasing the GDP outlook while there was also a jump in consumer confidence last week. For 2024, which will depend greatly on the actual 2023 results, there was a small reduction in the GDP estimate, falling from 2.3% to 2.2%.

Inflation

CPI estimates for 2023 rose from 9.15% to 9.22%. For the 12-month forecast, it is expected to fall to 6.82%. All eyes will be on the June reading from DANE in a couple of weeks.

Interest Rates

There has been a slight cooling on the outlook for the overnight rate for year-end of 2023, from 12.0% to 11.75%, with a 12-month outlook of 9.5%. For this month, the Colombian central bank will leave rates at their 13.25% peak.

Colombian Peso

There has been a dramatic revaluation of the currency recently and that is reflected in the latest analyst estimates. The new year-end 2023 consensus is 4,300 pesos to the US dollar versus 4,600 a month ago. In reality the peso never deserved to be at 4,500+ level, so this is a welcome, more-rational view.

Equities

There is a renewed sense of positivity around the COLCAP, with 81.5% believing the market will rise over the next three months versus 69.2% a month ago. In terms of sectors, holdings companies are the preferred choice, in particular Grupo Argos. In terms of other names, ISA Interconexión Eléctrica and Nutresa, despite the uncertainty over the new Gilinski leadership, are also in demand.

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The deal between the two parties, which was reportedly hashed out in a luxury hotel in Spain during the San Isidro Festivities and finalized by May 24, will give Gilinski 87% of Grupo Nutresa, while seeing Grupo Sura and Grupo Argos relinquish any stock or control of the company to him and his partners.

In exchange, three companies owned by or working with Gilinski — JGDB Holding SAS, Nugil SAS, and IHC Capital Holding LLC — will sell any Grupo Sura shares they may have. The Financial Superintendency of Colombia authorized the suspension of the trading of these three companies’ stocks from May 25 to June 15 for the benefit of the investors in the three companies.

While the details of how the deal went down are still unclear as of press time, an unnamed source reportedly told local newspaper El Tiempo that former Colombian President Álvaro Uribe Vélez was involved in the discussions and even opened up his home in Rionegro to facilitate the discussions.

READ MORE: Former Bancolombia President in Speech to Gilinski: Stop this War!

The agreement, at least for now, provides a bookend to the years-long crusade that Gilinski has waged with GEA to take control of various companies, including lawsuits against each other and recent fights over Grupo Nutresa’s board of directors.

The fight has been seen as damaging to the reputation of both parties despite the market capitalization of the three companies rising, with Grupo Sura’s value jumping by some 95.4% since November 2021 and Group Nutresa spiking 165.9% during the same period.

Steffanía Mosquera, a market analyst from Credicorp Capital, has said that the deal will likely be good for all the parties involved. “[At] first glance, we believe that this transaction (or series of them) should be positive for the Colombian market in a context of low volumes,” she told El Tiempo. “We also see that the transactions could help simplify the structure of Grupo Argos and Grupo Sura, which could be seen as positive by investors.”

At the same time, according to reports, they would hand back any shares in Grupo Argos and Grupo SURA. The press is calling this the end of the GEA cross holdings however in reality at first blush, it appears, to the creation of a smaller GEA with Celsia Energía, Cementos Argos and Bancolombia the other main components.

There are still more questions than answers.

1. The Gilinskis first chased Nutresa but many felt the ultimate goal, for well-documented personal reasons, was Bancolombia. Have they now given up on that ambition?

2. What will happen with the stock price of Nutresa? It will remain with almost no free float or liquidity and in the hands of a group who appear to be able to add little value to the company.

3. Might Sura or Argos now be in a position to refloat their shares via secondary issues? Does the agreement cover future Gilinski participation in the shares of the two groups?

4. Will Carlos Ignacio, one of the world’s most decent human beings, remain with Nutresa after all the bitterness of the past 18 months ?

5. What will the Gilinskis do with Nutresa? Will it be a quick turnaround and a sale to a foreign group?

6. Will the sacrifice of such an amazing asset be worth it in order to maintain the huge social and philanthropic structure that the GEA maintains in Medellín, a non-tangible that most don’t want to see?

This soap opera has had more twists and turns than Dallas, Eastenders and Breaking Bad combined but one wonders what will come next. It has done irrefutable damage to the equity markers but hopefully there is now some light at the end of the tunnel.

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Gilinski and the “Paisas” (people from Medellín and its surrounding region) quickly fell out, and ended on bad terms, with litigation lasting for more than a decade. Things remained relatively quiet, with Gilinski tending to his many other business ventures, including plastics manufacturers, media. candy companies, and his own Colombian banks, GNB Sudameris, and Lulo Bank, as well as his own ATM network serving his banks, and many independent credit cooperatives (credit unions) throughout Colombia.

The Paisas, who in some ways have had a more modern business outlook than other regions of Colombia, created a cross-ownership structure of major Medellín businesses to prevent control by dominant families like in other parts of Colombia—think the Santo Domingo, Ardila Lülle, or Gilinski family business dynasties—and also impose a level of corporate governance not usually seen in Latin American countries. Medellín does not have a political or business dominant family “running things” behind the scene pulling all the strings, unlike most of Colombia, or most of Latin America. Instead, for example, El Pais reports that as of 2021, Medellín food conglomerate Nutresa had no shareholder with more than 1%. This means that professional management had the influence, and nepotism is kept out. There is a cross ownership structure among major Medellín companies that serves as a form of checks and balances, but also keeps control local to the Paisa community. This cross ownership structure is known as the Grupo Empresarial Antioqueño (GEA) informally, but such a structure does not exist formally. It is more of an informal clan with common interests rather than a legally defined entity. The major companies own shares in each other, and control is shared through voting shares and corporate boards.

Mr. Gilinski does not like this arrangement and has been seeking to vindicate himself against the Paisas. Though he is already reportedly Colombia’s 2^nd or 3^rd richest individual according to various rankings, that is not enough juice to take on the well-coordinated and insular Paisa business community. Gilinski himself sought a “patron” (sponsor, godfather, boss, backer) in Abu Dhabi’s Sheikh Tahnoon bin Zayed Al Nahyan, son of the founder of the United Arab Emirates. Since 2021, Gilinski and his backers have waged a war against the Paisas to take control of their jewels, namely Bancolombia, Grupo Sura, Nutresa, and Grupo Argos: All large, publicly traded international companies, and the economic engines of Medellín.

It is difficult to overstate the effect of this “invasion” as they see it, on the close knit Medellín business community. It is no overstatement to say that regardless of one’s opinion of any one of the companies, they are foundational to Medellín’s identity the way Microsoft is to Redmond, Washington or Apple is to Cupertino, California.

Former Bancolombia President Carlos Raúl Yepes came out of retirement and private life to take the microphone during the extraordinary shareholder meeting of Sura, Colombia’s largest insurance and asset management conglomerate, where Gilinski was trying to take control of the company, to make a stirring speech in which he directly addressed the “war” as many see it, between Gilinski and GEA.

Carlos Raúl Yepes:

I want, before anything else, to say that no one has ordered me to be in this assembly. I am no one’s adviser, I am no one’s spokesman, I am doing this because of my convictions. I do not have stocks in any of these companies, but last Monday I bought a share from Grupo Suramericana Inversiones to be able to intervene today. It cost me 38.600 pesos, plus taxes and commission, and here I am. And my one share is worth as much as Dr. Jaime Gilinski and his entire group’s. So I want you all to know that I am not a messenger, no one has sent me. I was at my house, and I saw what was happening, and I was seeing it with a lot of sadness. I felt bad, feeling like I had to stay silent. Just like no one was forcing me to stay silent, no one was forcing me to come here. I simply wish to express my sadness for this nightmare. I know what Juan Luis is feeling because he worked with me, same with the lawyers, the directors, and I know this suffering that comes with being at the front of these companies. Pressured, discredited, that which they call the GEA that does not exist, they are just convictions from some very important people who in the past, in the years 35, 40, 45, started companies, companies that today are the pride of the country, companies that today are demonstrating what they do on an international level, companies that have never, if you take notice, been involved in any scandals. Here the only thing we know how to do is work, work honorably, and we won’t let anyone discredit that.

Today, what I want is to expose my testimony, Dr. Gilinski, of the experience I had when we met all those years ago. You are an intelligent person, a bold one, you know I respect you, and you have always respected me. That’s why when I went with Gabriel [Jaime Gilinski’s father], when I was named president of the bank, I already knew him, from the respect I had for your father, and I still do. And at that time, we decided to buy a majority of the percentage of the Bank of Colombia, which Dr. Gilinski, very young, had acquired his majority percentage. I think that was the year ’94, and we did the business in the year ’97.

And it started really well, we were doing really well when the Asian crisis came. By the end of the year ’97, we wrote to Dr. Gilinski’s lawyers, I never forget the name, Davis Loan. They write to our lawyer in New York Michael Manny, and they tell us, we have some serious problems. In that transaction, we were scammed, and the war starts. A war that lasted a long time, a war where they told us, you have to suspend the assembly of the year ’98. A war that, with all due respect I say because I lived it, no one has told me what I am saying, I lived it. And what I did you will understand why, it was 12 years of suffering where I couldn’t watch my children grow, where we all suffered so much. We solved one lawsuit and we got three more, and we got accusations and complaints. And Dr. Gilinski, I haven’t told this, but this scar I have here, I called it Gilinski. When I had heart surgery, I broke down. I was 33 years old, and it was the first 6 years out of 11, almost 12 years of suffering.

I remember that at that time Julio Sánchez spoke of the dream team, and it was. How couldn’t it be the dream team, a great team of distinguished lawyers, comprised of Doctor Fernando Londoño Hoyos; Doctor Fernando Hinestrosa, Principal of the Externado; Doctor Néstor Humberto Martinez and his father, Doctor Néstor Camilo; Doctor Luis Fernando López, former superintendent of stocks, Doctor Gustavo De Greiff, the prosecutor, Doctor Jaime Bernal, a former attorney; dream team.

Former Bancolombia president Carlos Raúl Yepes blames his heart attack on battles with Gilinski (courtesy Bancolombia)

And I have to say one thing, because history needs to be relived, brought back, remembered, because now, what I want to end with, which is why I want to mention it: that legal dream team was a small part, because the way that it was structured, it was a business that started really well, and I don’t understand why with businesses you have to design a political strategy, a communication strategy, to push it forward, when the legal side is enough, the ethical side is enough; but no, there was that legal front, and do you know who was the legal vice president of the Bank of Colombia, who was at the front of the transaction and negotiation with the Colombian Banco de Sol? And who was my speaker partner, because Dr. Gilinski assigned him to be our speaker, and I spoke with him, and we stepped forward to have [Colombian fast food chain] El Corral burgers for lunch, when we were in the due diligence [process]? Sirs, the one who guided that legal strategy, and coordinated the entire strategy with Dr. Néstor Humberto Martinez, was Doctor Alex Vernot Hernández, today sentenced to 71 months in prison for bribing witnesses in criminal proceedings. That was the great ideologist. I don’t know what is today the relationship between Dr. Gilinski and Alex Vernot.

Gonzalo: Dr. Carlos Raúl, since we are in assembly-

Carlos Raúl: Don’t worry doctor, I’ll be done in 10 minutes. I won’t take longer than that.

Gonzalo: No. Five minutes, please.

Carlos Raúl: Thank you very much, Dr. Gonzalo. By the way, the first time I see Dr. Gonzalo Pérez in seven years, I haven’t seen him in a while, not even texting, just so you don’t go saying that I talk to him and they sent me here to do something.

And after that legal strategy, Dr. Gonzalo Pérez, there was the political strategy. Politics needed to be added to that. Dr. Néstor Humberto, who today is not on very friendly terms with Dr. Vernot from what I read, they met with a very passionate and intelligent chamber (congress) representative who used for the first time an article of the Constitution that allowed political control over private entities. And on May 9, 2001, they sat Dr. Jorge Rondolio and myself with the whole team, resisting that political onslaught in Congress.

That passionate and intelligent politician is now President Gustavo Petro. The political side was taken care of. Politics is part of that big strategy. Dr. Álvaro Uribe appointed Isaac the ambassador of Israel, and Dr. Juan Manuel Santos appointed Isaac at the UN, and Dr. Iván Duque did the same, appointing him as alternate ambassador. They are good recognized and meritorious people. And it’s just a small part, but it turns out that communication also needs to be involved, there has to be communication, we have to tell stories, have a narrative. And to hire a great political strategist, who is still working. Mr. Ángel Beccassino, today adviser to Mayor Daniel Quintero, the axis of the triumvirate, that’s what we were facing, that’s what was making us suffer.

And why do I tell this story? Because it’s relevant, and it’s relevant because it’s  (unintelligible), and it has different fronts of war, and I have Dr. Gilinski in front of me, and I know you know that what I’ve said is absolutely true, and please, if I haven’t said something correct, you’ll correct me. But all I want to say and end with, Dr. Gonzalo, and I’ll finish, is that this war has to be stopped. Enough of this nightmare. Business can’t be done like this.

Video recording credit: El Colombiano

Gilinski has been trying to wrest control of Medellín’s most emblematic companies from the close knit Paisa (people from Medellín & surrounding region) business community since at least 2021. There is animosity between Gilinski and the Paisas dating back to when he lost control of the predecessor of Bancolombia—also Medellín based. The Paisas say this was due to the emergency caused by the Asian Financial Crisis, Gilinski seems to think he was the victim of dirty dealing.

With the Sheikh’s backing, Gilinksi has mounted a salvo of hostile takeover attempts for several of the companies in the GEA network, but the Paisas have been able up until now, to fend him off, though it has been close. Gilinski has launched multiple tender offers, but the Paisa shareholders have been unwilling to sell to him at any price.

On March 21^st, Paisa food company and GEA member Nutresa held its ordinary shareholders assembly, where a proposal was approved to extend Nutresa’s current board of directors for one year, keeping Gilinski from taking control but triggering extraordinary assemblies being called for Argos and Sura, since there is significant cross ownership and board of directors representation between the companies, after Colombia’s corporations regulator blocked Argos & Sura legal representatives from voting their shares in Nutresa, citing conflict of interest. Because of this, shareholder assemblies had to be called for formal votes.

It is important to point out that the GEA is an informal business network with common interests and overlapping ownership rather than a legally defined entity. The major companies own shares in each other, and control is shared through voting shares and corporate boards. This is known as the Grupo Empresarial Antioqueño (GEA) informally, but such a structure does not exist legally.

Friday, in Plaza Mayor, Medellín’s primary public plaza and convention facility, the mood outside of the shareholders’ meeting was more like a rowdy soccer match, with employees of Sura and Nutresa gathered en masse, with placards and chants telling Gilinski to go back where he came from, and to leave the GEA alone. The atmosphere was so raucous that Colombia’s ESMAD riot police showed up, to the indignation of GEA employees present.

Friday morning, various generals of Paisa enterprise were gathered and ready to confront Gilinski and his team. Carlos Ignacio Gallego of Grupo Nutresa, Ignacio Calle of Sura, David Correa of Protección (pensión fund), and Jorge Mario Velásquez of Grupo Argos were in position. Sura’s meeting was scheduled for 8am, but Gilinski tried to make a move by calling another extraordinary assembly to elect Nutresa’s board of directors at 7:55am, which would conflict with the Sura meeting. Only representation of 5 million shares, or just over 1%, not enough for a quorum, heeded Gilinski’s call so the meeting failed.

At 8am the Sura shareholders’ meeting began, with an unexpected turn of events as retired president of Bancolombia and veteran of the GEA war with Gilinski took to the microphone as the owner of a single share of Sura. He gave a stirring speech in support of the GEA (though he denied its existence) and urged Gilinski to in so many words, leave Medellín alone.

Once it was time to count the votes, the crowd cheered and applauded votes in favor of the GEA, and jeered and booed when any votes for Gilinski were counted, again more like a sporting match than a corporate shareholder’s meeting.

At the meeting’s climax, Sura shareholders approved the measure enabling the company’s legal representative to vote the company’s shares in Nutresa, once again, keeping the Gilinski crew from taking control of any of the GEA companies.

After losing the battle, Gilinski spoke in a conciliatory tone, thanking “the people who work at Grupo Sura for the effort they have made. I want to thank [President] Gonzalo, the administration, and the board of directors for so many hours of effort because it has been a difficult year.

“I’ll be back!”—Arnold Schwarzenegger in The Terminator

Though Gilinski has lost a major battle, the war may not be over. He is still a significant shareholder in GEA companies. On April 11, shareholders of Nutresa will meet to elect its board of directors. The Paisas may have the upper hand with Friday’s empowerment of Sura’s Legal Representative, but nothing is certain, especially in this corporate drama that could potentially reshape Colombia’s business landscape, and most certainly that of Medellín’s Aburrá Valley.

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