Our experience in Construction & EPS is vast and varied.
Construction & EPC companies are one of the companies most difficult to analyse because traditional accounting usually does not reflect reality. Besides, these companies are involved in multiple activities which require individual treatment. Inicia2 has a proved track record in this field, involved in the most challenging Construction & EPC events in Europe.
- Fomento de Construciones y Contratas (FCC). Financial analysis of the company compared with the peers, competitive environment, financial modelling of FCC and its main subsidiaries. An institutional investor was interested in the debt restructuring of this construction company with the aim to take part in the capital increase.
- Isolux. Inicia2 was involved in the different stages of the biggest default in the Spanish history, first alerting the clients of the company problems, then supplying market intelligence about the different units, then restating the accounts and analysing the real value of the subsidiaries to evaluate if the collateral was enough to cover the debt. Finally, we calculated the liquidation value of the company through sum-up of the parts and calculating all the liabilities. This exercise was carried through many months and our clients ranged from banks, bondholders to new equity investors.
- Abengoa used to be the largest electrical EPC group in the world and similarly to Isolux, it recorded the largest debt restructuring of Spanish history. Inicia2 began alerting equity investors of the problems with the cash generation. Then, we were involved in the first debt restructuring, analysing and restating the accounts of the company. We presented this restructuring was not enough. We were also involved in the second debt restructuring where we analysed the non-core assets and the potential value supporting the new debt, the disposal of the transmission lines in Brasil and we analysed the strategic plan launched by the company alerting our clients of a third debt restructuring. This exercise was carried out for five years, and our clients ranged from banks, bondholders to new equity investors.
- Sacyr, the main Spanish construction company, was having problems to finance its operations. The company hired Inicia2 to benchmark the debt structure of Sacyr in comparison with other competitors and opinion on the issue of convertible bonds.
- Grupo Sando was after the third financial restructuring in a row. An institutional investor wanted to acquire the debt of this mid-size construction company and Inicia2 was involved in the due diligence process with a focus on the financial analysis of the company compared with the peers, competitive environment, financial modelling of Sando and appraisal of the real estate assets.
- Inicia2 provides every year a general outlook of the Polish construction sector to main equity funds. Market quantification, competitors, financial analysis of each of the competitors and future investments
- Inicia2 also provides every year an outlook of the main European Construction Companies to institutional investors in equities.
- Aldesa, the Spanish mid-size construction company issued bonds in 2014. Inicia2 advised certain investors on the bond issue. Then we provided quarterly follow up, and in 2016 we supplied a thorough insight of the Mexican business, after some troubles there. We alerted of the sustainability of the corporate debt, and finally, we were involved in the debt restructuring of the company in 2019, representing an investor of the new money. This exercise was carried through many months and our clients ranged from banks, bondholders to new equity investors.
- CMC Ravenna, the Italian construction company, refinanced the corporate bonds in 2017. Inicia2 advised certain investors on the second bond issue, alerting of the financial weakness. During 2018, we were involved in several studies of the corporate bonds of the company, due to the big discount. Finally, we provided an approach to the liquidation value of the company. This exercise was carried through many months and our clients ranged from banks, bondholders to new equity investors.
- Astaldi, the second-largest Italian construction company, was reporting abnormally good figures in 2015. Equity investors hired Inicia2 to analyse the evolution of the company and whether the company could absorb the new Turkish concessions. Then, certain bond investors hired Inicia2 to analyse the solvency of the company. Finally, Inicia2 analysed the liquidation value of the company. This exercise was carried through many months and our clients ranged from banks, bondholders to new equity investors.
- WeWork. Salini Impregilo, the Italian biggest construction company, was to issue a new bond series to refinance the previous issue (similar to CMC Ravenna). A bond investor was seeking external advice before subscribing new bonds. Inicia2 provided advise on the performance of the company. The company started experimenting a huge gap between the bond price and the share price. Finally, bondholders hired Inicia2 to analyse the merger of Salini Impregilo and Astaldi, generating WeBuild. There were serious doubts about the artificial support of the Italian banks on the company
- Main construction conglomerate in Egypt was aiming to set up a strategy department and wanted to develop a strategic plan. Inicia2 provided benchmark about the main features of a strategy department (dimension, costs, type of personnel, level of dependency, activity, etc.) and also provided the guidelines to build a strategic plan.
- OHL, the sixth-largest Spanish construction company, was showing a discrepancy between cash generation and excellent accounting profits. Inicia2 provided an opinion on the debt situation and the results of the company compared with the peers. After the banks forced OHL to make a capital increase, Inicia2 rendered an opinion on this event to certain investors. Then, the company made several management changes, and Inicia2 analysed them. After the disposal of the concession business, Inicia2 analysed the situation of the company and its future. Certain bond investors were interested in the financial health of the strategic shareholder, GVM, and the potential risk of full disposal of its shares, intending to determine a takeover bid. Inicia2 also analysed the real estate business, the main guarantee of the solvency of the company, concluding a debt restructuring was necessary. Finally, after the COVID-19 crisis, Inicia2 has analysed the potential debt restructuring and its different scenarios. This exercise was carried out for five years, and our clients ranged from banks, bondholders to new equity investors.
- Analysis of the sale of Kauno Tiltai. Trakcja, a main Polish construction company, was aiming to sell its main subsidiary in Lithuania. Inicia2 was part of a team to due diligence the acquisition of this company.
- ACS, the largest construction company in Europe, announced the disposal of its industrial engineering business. Equity research company wanted to understand the business rational for such a transaction.
- Prodiel, the largest PV developer in Europe, needed an extra financing line to finance its new projects. An international bank was interested in taking a part in this loan and hired Inicia2 to analyse the company, its projects and very specially a portfolio of 1.000Mw under construction.
- Ferrovial, the fifth European EPC, was having problems with Amey, the British service provider arm of the company. An equity investor wanted to understand Amey and the similarities with Carillion. In a second stage, an infrastructure fund was interested in Amey and wanted a preliminary analysis of the company (strategic, financial and contract evaluation).
- Carillion, the British construction and service leader, was showing contradictory results (there was an unexplained gap between cash flow generation and accounting results). Inicia2 analysed the company, the different business lines and a comparison with the European pears. In a second stage, Inicia2 broke down the debt and restated the cash flows of the company, in a scenario of liquidity problems. Finally, the company was in financial distress, and some debt holders were interested in the liquidation value and recovery.
