Criteria to Make a Decision Regarding the Remaining 49% Stake in Saba on 24 May

23 May 2018 – Expansión 

Tomorrow (Thursday 24 May), the Board of Directors of Criteria, the investment arm of La Caixa, will make a decision regarding the future of Saba, the parking lot group of which it is a controlling shareholder, with a 51% stake. Criteria must decide whether to purchase the remaining 49% share capital currently in the hands of KKR, Torreal and ProA Capital or, by contrast, accept an offer for the purchase of 100% of the company chaired by Salvador Alemany.

According to sources close to the operation, Criteria’s position will be to emerge as the buyer, once the economic estimate of the asset has been made known, whose valuation ranges between €1.2 billion and €1.4 billion.

The investment by La Caixa’s industrial holding company will put an end to the period of uncertainty that the company has been experiencing since Torreal (20%), KKR (18.5%) and ProA (10.5%) agreed to sell their combined 49% stake in a coordinated way more than a year ago. Saba’s minority shareholders have forced this outcome. According to the shareholders’ agreements, the drag-along clause was activated in May, which means that any of the shareholders may require the sale of 100% of the company. KKR, ProA and Torreal notified La Caixa of their intention to find a buyer. According to sources consulted, Criteria has expressed its willingness to buy at the estimated prices. Several funds have also expressed their interest in Saba. As Expansión revealed in November 2017, Arcus was one of the first funds to propose an agreement. In the market, sources also point to Macquarie, which purchased Empark last year.

For Criteria, which has declined to comment, the investment in Saba would represent its first major buy-side move since it sold 10% of Gas Natural Fenosa to the fund GIP in 2016 for around €1.8 billion and following its exit this month from Abertis, after accepting the joint takeover bid presented by ACS and Atlantia. For its 18% stake in the highway group, Criteria has received more than €3 billion, which it will use to fund new investments.

The conversations have accelerated in recent weeks to the point that Saba had to postpone its General Shareholders’ Meeting. Originally, it had been convened for 9 May, but it has been postponed until 12 June pending an agreement between the shareholders.

Original story: Expansión (by C.M., M.P.L. and A.Z.)

Translation: Carmel Drake

Saba Delays AGM by 1 Month to Finalise New Ownership Structure

3 May 2018 – Expansión

Never before has an ordinary general meeting of Saba’s shareholders raised so much expectation. The parking lot company, in which Criteria Caixa holds a 50.1% stake, has delayed the shareholders’ meeting that it had planned to hold in Barcelona on 9 May, postponing it until 12 June. The reason is that the shareholders still need to agree on the changes in their stakes in the parking lot company.

Its been a while since Torreal, which owns 20% of Saba; KKR, which holds 18.5%; and ProA, which owns 10.5%, expressed their intention of divesting their stakes in the company, a move that is logical for funds, which typically rotate their portfolios every few years.

But Criteria Caixa, which is in a position to buy, in light of the proceeds amounting to €3 billion that it is going to receive over the next few months when it sells its stake in Abertis, has initiated conversations with the other three major shareholders to take control of the company. The remaining 1.2% of the shares, which are owned by small investors, proceed from the time when Saba belonged to Abertis.

In parallel, Criteria is also planning to hold a Board Meeting at the end of this month to define the final position of its investment portfolio. Sources consulted assure that a decision will be taken at that meeting as to whether to take over complete control of the company led by Josep Martínez Vila or to sell its stake. In theory, all indicators are that Criteria Caixa will become Saba’s sole shareholder.

Finishing touches

During the extra month that they will now have, the shareholders are going to close all of the details to approve the changes in their shareholding. Meanwhile, Saba has justified the change of date in “the greater social interest and for reasons beyond its control”. Nevertheless, some parties were in favour of holding the meeting and organising another extraordinary meeting later on, once the shareholder restructuring has been agreed.

The aspects to be discussed include the distribution of a dividend amounting to €19.95 million, charged against the issue premium; the approval of the results; and, as the fifth item on the agenda, the re-election and appointment of the directors.

Criteria is going through a time of enormous liquidity due to the funds that it is going to receive when it sells the 18% stake that it holds in Abertis and because it has not participated in any large operations since it divested its 10% stake in Gas Natural Fenosa, for which it obtained €1.8 billion.

Saba, chaired by Salvador Alemany, is worth around €1.4 billion, on the basis of a multiple of between 12 and 14 times its EBITDA, which amounts to around €100 million. The company manages 195,000 parking spaces and, in 2016 – the most recent year for which data is available – it recorded revenues of €205 million (+17%) and obtained EBITDA of €94 million (+10%) (…).

Original story: Expansión (by Artur Zanón)

Translation: Carmel Drake

Torreal, KKR & ProA May Force La Caixa To Sell 100% Of Saba

10 November 2017 – Expansión

The European parking lot market is at boiling point. Following the sale of Empark earlier this year to the Australian fund Macquarie, now comes the turn of Saba, the other Spanish leader in the sector, controlled by Criteria (La Caixa). According to financial sources consulted, the firms KKR, Torreal and ProA, which together own 49% of the company, have resumed the plan to sell their shares. Unlike in previous processes, on this occasion, the conversations with investors revolve around the sale of 100% of the company, given that, by agreement between the shareholders, they may force La Caixa to sell its controlling 50.1% stake.

According to preliminary estimates, the valuation of the company could reach €1,150 million. Until last December, the company’s financial debt amounted to €545 million. Sources at Saba declined to comment on the news.

The parking lot group closed 2016 with turnover of €222 million, compared to €225 million in 2015, when its revenues still reflected income from its logistics parks. The company, a spin-off of Abertis, constituted in 2011, obtained an EBITDA of €103 million and earned €4 million from its ordinary activity in 2016 (€32 million with the gains from the sale of its logistics business to the Socimi Merlin).

Two hundred thousand parking spaces

The group manages 195,000 parking spaces across Spain, Chile, Portugal and Italy and employs 1,400 people. Its last major operation was the contract it won in 2014, with a bid amounting to €234 million, to manage the parking lots in Barcelona through a joint venture with the city’s Town Hall.

Potential buyers for Saba include the large investment funds that specialise in infrastructures. Sources in the market say that the investment firm Arcus, which manages a portfolio of assets worth €17,000 million, is looking at this opportunity. KKR, Saba’s third-largest shareholder, purchased the parking lots of the Dutch firm Q-Park earlier this year for almost €3,000 million. Meanwhile, Ardian and Predica also put the French market leader Indigo up for sale this year; that company has strong interests in Spain and is worth around €3,000 million.

There have been other smaller transactions in Spain, such as the agreement signed by Oak Hill to acquire Isolux’s best parking lots and the sale of Parkia to First State for €300 million.

Saba, which is chaired by Salvador Alemany, suffered a major setback this summer after losing the bid for Empark. The parking lot group, whose vocation since its constitution has been to make its debut on the stock market, had wanted to absorb Empark to acquire critical mass for its stock market debut. But its offer was lower than the one presented by the Australians, which, according to the market, bid around €900 million.

Following that setback, the minority shareholders have reactivated the sales plan. Specifically, the shareholders’ agreement lapses in November and the funds have a drag along clause to force the other shareholders to sell. The timeframe for looking for interested investors runs until May 2018 and if Criteria does not want to sell, then it has the right of first refusal to buy the shares that it does not control at the same price agreed with the investor (…).

Original story: Expansión (by C. Morán, I. Abril and M. Ponce de León)

Translation: Carmel Drake

Saba Wants To Complete A Major Purchase Before Its IPO

1 June 2017 – Expansión

Saba is analysing several major operations with the aim of growing in size before it debuts on the stock market, according to the plans that the company’s President, Salvador Alemany (pictured above, right) outlined yesterday, at the car park group’s General Shareholders’ Meeting.

“We are looking at operations that would allow us to grow significantly and which would take several months or years to complete; afterwards [with our debut on the stock market], we would see the results of all of the efforts that we have been making since 2011”, said Alemany yesterday, in response to two questions from the company’s two minority shareholders. For the time being, there is no specific timetable for the firm’s debut on the stock market – Saba set itself the objective at the same time that it was carved out from Abertis in 2011.

The CEO of Saba, Josep Martínez Vila (pictured above, left), confirmed that Empark is one of the operations under analysis, but that there are also others in the running. The advantage of acquiring that firm stems from the fact that it would allow Saba to double in size; by contrast, it would mean concentrating its business even more in Spain, which last year accounted for 71% of its turnover.

The group closed 2016 with turnover of €202 million, compared to €225 million in 2015, a year when it was still recording revenues from its logistics parks. Saba, which yesterday approved the distribution of an issue premium amounting to €20 million, earned €4 million from its ordinary activity, a figure that increases to €32.36 million with the profits from its logistics business.

The company, which was just awarded the contract to manage 12,000 parking spaces in three shopping centres in Chile, has also just agreed with the banks to improve the conditions of a €465 million loan.

Original story: Expansión (by A. Zanon)

Translation: Carmel Drake

Villar Mir Engages Colliers To Accelerate Partial Sale Of Canalejas

26 September 2016 – Expansión

Grupo Villar Mir, the controlling shareholder of OHL, is making progress with its aggressive divestment plan, through which it aims to reduce its own level of indebtedness, as well as that of the construction company, and solve the financial problems that it finds itself immersed in. To this end, the industrial holding company has accelerated the search process to identify an investor willing to buy some of the complex of Canalejas buildings in Madrid.

Specifically, the Villar Mir group, which controls the project through a holding company (75%) and OHL (25%) has engaged the real estate consultancy Colliers to analyse the sale of a minority stake in the Canalejas complex, the real estate project that it is currently developing in the centre of Madrid.

The aim is to analyse the proposals that various investment groups have submitted to the owner of OHL, to participate in the project, which is expected to require an investment of €500 million. “This analysis phase will be completed in October and only then will we be able to take a decision regarding the possible partial divestment, whilst retaining control over and our commitment to the project”, said sources at the company.

According to El Confidencial, a number of possible interested parties are presenting themselves as contenders, including the international funds TH Real Estate and Lone Star.

In any case, Villar Mir will retain a majority stake in the project, given that its intention is to sell a stake of between 30% and 49%.

At the beginning of 2013, Villar Mir purchased seven buildings from Banco Santander, located between Calles de Alcalá, Sevilla and Plaza de Canalejas, for €215 million. The complex will house a luxury hotel managed by the Four Seasons chain, around 20 homes associated with the hotel, a shopping centre covering 15,000 sqm and a 500-space car park.

Initially, Villar Mir hoped to open the complex at the end of 2016, but problems with the Town Hall of Madrid relating to the renovation work delayed the project and it is now not expected to open until 2018. The construction company has launched a comprehensive divestment plan. Its portfolio of assets available for sale include 7% of Abertis, the industrial division, and the Mayacobá Mexican hotels. (…).

Original story: Expansión (by C. Morán and R. Ruiz)

Translation: Carmel Drake

Villar Mir Sells Another 5% Stake In Colonial For €114M

10 June 2016 – Expansión

Grupo Villar Mir has sold off another 5% stake in Colonial for €114 million. Together with that stake, another 1.23% of the shares, which had been owned by the President of OHL and which are currently held by Société Général, have also been placed on the stock market.

Following this operation, the company owned by Juan Miguel Villar Mir has lost its status as the majority shareholder of Colonial; Qatar Investment Authority takes over that mantle, with its 13.13% stake.

It is the second time that Villar Mir has decided to sell shares in Colonial in less than a year, after it sold a stake representing 10% of the share capital, worth €178 million, in September last year.

Whilst that divestment was undertaken in order to finance OHL’s capital increase; this time around, the objective is to reduce the gearing ratio of Grupo Villar Mir, given the current climate of volatility on the stock markets, said sources close to the company yesterday. On the other hand, with this sale, the group will generate significant capital gains.

Willingness to continue as a shareholder

The same sources said that Grupo Villar Mir continues to be “very satisfied” with its shareholding in Colonial – it still has a great deal of confidence in the company’s future and does not expect to sell any more of its shares in the group in the coming months.

In May 2014, Villar Mir participated in Colonial’s capital increase, subscribing in full to the amount that corresponded to it on the basis of its shareholding in the company. In order to finance that operation, Grupo Villar Mir negotiated a financing contract with Deutsche Bank amounting to €300 million. The contract was divided into two tranches. The first, amounting to €100 million, had to be repaid within a period of less than a year, whilst the second, amounting to €200 million has to be repaid within a period of five years.

Last September, Villar Mir also sold a 2.9% stake in Abertis, which, like in the case of this sale of its shares in Colonial, it justified by the need to finance OHL’s capital increase. The businessman’s stake in Abertis was reduced to 16%.

The Catalan real estate company Colonial earned €11 million during the three months to March 2016, which represents a 131% increase compared to the same period last year, when its profits amounted to €5 million. Last May, Colonial announced that it was going to carry out a non-monetary capital increase, amounting to €265 million, so as to continue to acquire office buildings. In parallel to this operation, the group is preparing to make investments worth €400 million. Colonial’s shares closed trading yesterday at €0.709 per share, having increased by 1.14%.

Original story: Expansión (by M. Anglés and C. Morán)

Translation: Carmel Drake

Villar Mir Sells Torre Espacio To Grupo Emperador For €558M

30 November 2015 – Expansión

Villar Mir has found a buyer for its Madrilenian skyscraper Torre Espacio. The group led by Juan Miguel Villar Mir has signed an agreement with the Philippine group Emperador for the sale of its 236m-tall office building, located in the Cuatro Torres Business Area in Madrid.

Emperador, the largest spirits company in the Philippines (it holds agreements with the Andalucían group González Byass) will pay €558 million for the property (around €9,200/m2), somewhat below the €600 million sales price that the seller was hoping to secure.

Inaugurated in 2007, Torre Espacio contains 60,000 m2 of office space, spread over 57 floors. It houses the offices of British American Tobacco and Red Bull, as well as the embassies of Australia, Canada, the Netherlands and the United Kingdom. Its occupancy rate is 85%.

The building’s main tenant is the Villar Mir group itself and its subsidiaries, which occupy 55.1% of the property. According to the President, Juan Miguel Villar Mir, the construction company and the other subsidiaries, such as Fertiberia and Ferroatlántica, will continue to have their headquarters in the Madrilenian skyscraper.

In fact, to make the purchase more attractive, the owner of OHL offered to remain as a tenant in order to guarantee rental income of €34/m2/month, according to real estate sources.

Emperador has succeeded in taking ownership of Torre Espacio despite being a very late joiner to the process, which was launched in June, when Villar Mir engaged the consultancy firm Aguirre Newman. In recent few weeks, the best positioned candidate has been the real estate fund Invesco. The real estate company Colonial had also initiated a due diligence process for the building, according to sources close to the operation. Other investors studying the purchase of Torre Espacio included Corporación Financiera Alba – owned by the March family – , the German fund Deka and Pontegadea – the real estate company owned by Amancio Ortega.

The Philippine group Emperador forms part of the Alliance Global business conglomerate led by Andrew L. Tan, who also owns real estate businesses through his company Megaworld. With this purchase, Emperador joins the huge list of investors that have purchased real estate assets in Spain in 2015.

Funding for OHL

With the transfer of Torre Espacio, Villar Mir will generate significant income, having reduced its stake in the listed companies Abertis and Colonial to cover its part of the €1,000 million capital increase in its construction company OHL. Villar Mir invested €400 million in the construction of the building, including the purchase of the land.

However, the businessman is not abandoning his real estate investments at the Cuatro Torres complex; he has been working on the construction of a fifth tower on an adjacent site for several months. (…).

The Villar Mir group is also working on the Canalejas complex, in the centre of Madrid, where it plans to invest €500 million.

Original story: Expansión (by R. Ruiz and C. Morán)

Translation: Carmel Drake

Torre Espacio Sale: March Family & Invesco In Final Round

3 November 2015 – Expansión

Grupo Villar Mir is pushing ahead with the process to sell Torre Espacio, the skyscraper it owns in the Cuatro Torres complex in Madrid. By Wednesday 21 October, the company, which commissioned the consultancy Aguirre Newman to advise on the sale of the property back in June, had received at least five binding offers for the building, located on Paseo de la Castellana.

Villar Mir, which owns the building through its real estate company Espacio, has ruled out three of the five offers, since they all made demands on the vendor, which will now become the main tenant of the property, with its companies OHL, Espacio, Ferroatlántica and Fertiberia, amongst others, occupying 50% of the tower. According to sources in the sector, two international funds and the subsidiary of a European insurance company, which some sources have identified as Axa, demanded corporate guarantees from Villar Mir, such as shares in some of its group companies (Abertis and Colonial), by way of aval for the payment of the rent, however the owner of Torre Espacio is not prepared to go down that route. According to Juan Miguel Villar Mir himself, the vendor is willing to secure the payment of the rent for the approx. 50% of the surface area that it will occupy, but not through shares of the listed companies that it owns.

In this way, the owner of OHL has pre-selected two offers – one made by the fund Invesco Real Estate, which has teamed up with a partner, and the other made by Corporación Financiera Alba, the investment arm of the March family. Both offers must amount to around €600 million, as that is the minimum amount for which Villar Mir has said it would be willing to sell the building.

Final round

Now, the vendor is evaluating whether to invite both candidates to participate in a final round of analysis (a more comprehensive due diligence of the property), something the bidders would rather avoid, or to opt for one of the bids only. Another option being considered is to accept a third candidate if one of the investors were to make changes to its original bid.

In both cases, Villar Mir would end up closing the operation before the end of the year, although other sources say that the deeds will not be signed now until 2016. (…).

Torre Espacio, opened in 2007, is 236m tall and has 60,140m2 of office space. Villar Mir invested €400 million on its construction.

Besides the Villar Mir group, other tenants of the skyscraper include companies such as Red Bull, British American Tobacco and Sonatrach, as well as the Dutch, British, Canadian and Australian embassies.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Villar Mir Sells 7.3% Of OHL To A Monaco Fund

13 October 2015 – Expansión

Three days after launching a €1,000 million capital increase for OHL, the Villar Mir group has transferred some of its subscription rights to enable it to meet its commitment to invest in the operation and still retain a stake of more than 50%.

Specifically, the family holding company has sold 10.89 million rights to the investment fund Tyrus Capital, which is equivalent to the acquisition of 21.78 million new shares in the construction company, i.e. approximately 7.3% of the group’s capital. Villar Mir did not reveal the revenues received from the transaction yesterday, but at the listed price of the rights last Friday (€5.60), the businessman would have obtained around €61 million, which he will use to cover his part of the subsidiary’s capital increase.

Tyrus Capital is a hedge fund based on Monaco, founded by the Lebanese banker Tony Chandraoi. The firm specialises in event-driven transactions (i.e. those resulting from extraordinary movements that alter the value of assets) such as, for example, OHL’s capital restructuring process. In the statement issued to the CNMV yesterday, OHL said that Tyrus Capital plans to subscribe to the capital increase for purely financial reasons and has not asked to take a seat on the Board of Directors of the construction company, despite the fact that it is now a significant shareholder.

Both Villar Mir and Tyrus Capital have been given preferential purchase and sale options lasting 18 months following the start of trading of the new shares in the company, in the case that certain events happen.

Extraordinary funds

To finance the expansion (around €400 million), Villar Mir has been forced to sell a significant part of the industrial group’s most liquid assets. In September, the holding company sold a 10% stake in Colonial and a 2.6% stake in Abertis. Yesterday, it announced the sale of 10.89 million rights in OHL (it still retains 458,415 rights, which give it the right to 916,830 new shares in OHL, i.e. 0.3%) and it is likely to also participate in the takeover of 6.5% of Abertis, whose acceptance period expires on 20 October.

“We have assets worth more than €7,000 million to fulfil our commitment”, said Juan Miguel Villar Mir (pictured above) a month ago as proof of his group’s financial solvency. Nevertheless, the businessman acknowledged in the capital increase brochure that the majority of the shares in Colonial, Abertis and OHL have been pledged and so, in theory, the availability of the funds, generated by the divestments made, is limited.

With the participation of Tyrus, OHL has now secured 57% of its capital increase and interest in the company seems to be growing in light of the listing of the rights and the shares. Yesterday, OHL’s rights were trading at €6, an increase of 7.6% since Friday. On the other hand, the group’s shares closed up 1.8% yesterday, at €8.20 per share.

OHL wants to use the €1,000 million it will raise to substantially reduce its debt. It plans to use around €600 million to repay its loans and the remainder to finance new highway concessions it has been granted in Latin America.

Original story: Expansión (by C. Morán)

Translation: Carmel Drake

Villar Mir Puts 5th Skyscraper On Hold To Focus On OHL

21 September 2015 – Expansión

Grupo Villar Mir has decided to put the project to construct a fifth tower in the Cuatro Torres Business Area on the Paseo de la Castellana in Madrid on hold. The project was going to involve an investment of €500 million, but instead the group will focus all of its financial resources on the clean up of OHL.

The construction company, in which the businessman Juan Miguel Villar Mir holds a majority stake (59.8%), has announced a €1,000 million capital increase to reduce its debt and strengthen its balance sheet. Villar Mir has been investigating different ways of obtaining the more than €500 million it needs to finance the operation and avoid a reduction in its stake in the company. The businessman has been forced to sell some of the capital that he held in two listed companies, Colonial and Abertis. He has raised €559 million through these two operations.

Moreover, at the end of June, Villar Mir engaged the real estate consultancy Aguirre Newman to sell Torre Espacio, the other skyscraper that the group owns in the complex on the Castellana. Villar Mir hopes to receive €650 million for the building. However, the process is being drawn out by the fact that, to date, the group has not received any offers that meet its expectations. The company has decided to invite more investors to participate in the process, which was initially scheduled to close this summer.

Grupo Villar Mir was awarded the plot of land behind the Cuatro Torres complex a few months ago….after it committed to pay an annual fee of €4 million for the use of the land for the next 75 years.

On the newly acquired plot, which has a surface area of 33,325 m2 and 70,000 m2 of buildable area, Juan Migual Villar Mir was going to allocate 53,000 m2 for social use (i.e. to provide some kind of public service). The remaining 16,500 m2 was going to be allocated for commercial use, with a further 33,647 m2 of green space.

Villar Mir had hoped to lease the building to a hospital group, which would dedicate the majority of the space to its own centre and the remaining floors to research. (…).

Tenant

Meanwhile, Villar Mir reached a pre-agreement with the USA company Mount Sinai, to open a Spanish branch of its prestigious New York medical centre in the future tower. However, the US firm was not convinced by the structure of the building; it would rather rent a less tall building, which is more practical for a hospital and with a more affordable rent.

Without a tenant, it will be difficult for Villar Mir to tackle such an expensive project. In addition to the €300 million that it will have to pay for the plot of land, by means of the annual fee of €4 million over 75 years, Villar Mir will have to spend at least another €140 million on the construction of the new building.

The group and especially its president do not want to give up on the project and are still working on a solution. The search continues for a tenant in the hospital sector or from the world of education, to open a centre of reference in the building. Another alternative for Villar Mir would involve the redesign of the project and the construction of several high-rise buildings, rather than a single skyscraper.

Original story: Expansión (by R. Ruiz and C. Morán)

Translation: Carmel Drake