Tag: Duro Felguera

Duro Felguera Sells 2 Madrid Office Buildings to Signal Capital

14 March 2018 – Property Funds World

Signal Capital Partners has completed the acquisition of two office buildings in Madrid from Duro Felguera. Optimus Global Investors acted as sole advisor instructed by the vendor.

The largest building is the corporate headquarters of Duro Felguera in Madrid, which is located at Via de los Poblados 7, in the consolidated Campo de las Naciones Business Park. The freestanding office building comprises an area of almost 14,000 sqm GLA, set over five floors, as well as two basements with 228 car parking spaces. Duro Felguera has entered into a new lease over part of this building.

The Campo de las Naciones office market is considered to be one of Madrid’s most established and attractive office markets outside the CBD, strategically located midway between the Barajas airport and the CBD and near Madrid’s exhibition centre. The building benefits from both high visibility from the main ring road (M-40) and large open plan floor layouts. It is also next to the Cristalia Business Park, comprising almost 100,000 sqm of office accommodation, a modern hotel and amenities such as a nursery and several restaurants.

The second property is a vacant office building located at Calle Jacinto Benavente 4 in Las Rozas, Madrid. That property comprises an area of 2,600 sqm GLA, set over three floors and with 133 car parking places. The property, next to Tripark, is located in the Las Rozas Business Park, a consolidated office area in the northwest of Madrid in which well-known multinationals such as HP, Bankia, Oracle, Día, Santander, Adidas, ING and Triodos, amongst others, are located. It has a high occupancy rate, is easily accessible by car from the main highways of Madrid (A-6, M-40 and M-50) and enjoys amenities such as restaurants, gyms, shopping centres (Las Rozas Village and Heron City) and leisure activities.

Kris Van Lancker, Managing Director at Optimus Global Investors, says: “This has been one of the most complex transactions in which Optimus has successfully advised. The difficulty lay in finding the fine balance between the financial and office space needs of Duro Felguera in the scope of its global refinancing program and the investment requirements of Signal Capital Partners. It allows Duro Felguera to divest its non-strategic assets and at the same time helps Signal meet its risk-adjusted return targets.”

Original story: Property Funds World

Edited by: Carmel Drake

British Fund Signal Capital Partners Offers €30M+ for Duro Felguera’s HQ

7 February 2018 – Eje Prime

The sale of the headquarters of Duro Felguera in Madrid could be on the verge of being signed. The Asturian company has received an offer for more than €30 million from the British investment fund Signal Capital Partners. And the company has already requested a due diligence, according to El Economista.

Before Signal, the Duro Felguera building, located at number 7 Calle Vía de los Poblados in the Spanish capital, had been courted by two other interested parties: Banco Sabadell and Sandra Ortega, one of the daughters of the Inditex founder.

Two months ago, the Spanish bank offered €33 million for the building, but it seems that neither its bid nor the €38 million that Sandra Ortega (…) placed on the table convinced the Asturian group. In the case of Ortega, the economic proposal was accompanied by one condition: the rental of the asset for ten years, at a price of €2 million per year and a seven-year deposit, according to Vozpopuli.

Duro Felguera, which is on the brink of filing for creditors’ bankruptcy, has until 15 April to reach an agreement with the banks to restructure its debt, which exceeds €900 million. For that reason, the company is particularly keen to complete the sale of this asset.

If the fund reaches an agreement, it would represent Signal Capital Partners’ second operation in Spain. In 2017, it took part in the purchase and remodelling of Aparthotel Orquidea, an establishment located in Ibiza, with a surface area of 12,000 m2 and 198 rooms.

Original story: Eje Prime

Translation: Carmel Drake

Sabadell Offers €33M for Duro Felguera’s HQ in Madrid

20 November 2017 – Eje Prime

Sabadell may complete the purchase of a new asset very soon. The financial institution is close to signing the acquisition of the headquarters of the company Duro Felguera for €33 million. The Asturian company, which is fighting hard to avoid having to file for creditor bankruptcy, would raise liquidity for its internal battle as a result of the agreement.

Interestingly, Duro Felguera must have rejected an offer amounting to €38 million from Sandra Ortega, the daughter of the founder and President of Inditex, Amancio Ortega. According to Voz Populi, although she was offering a higher financial proposal, she was also imposing the condition that the company remain as the tenant of the property for ten years, in return for a price of €2 million per year and a seven-year deposit.

By contrast, Sabadell is offering €33 million without any requirement for the company to remain in the building or to pay any deposits, which means that Duro Felguera would see a cash inflow of between €10 million and €15 million after paying off its loan.

Original story: Eje Prime

Translation: Carmel Drake

Sabadell Seeks Approval From Creditor Banks To Buy Duro’s HQ In Madrid

17 November 2017 – El Comercio

Banco Sabadell has provided a solution to unblock the complex situation that Duro Felguera finds itself in. With its proposal to purchase the building that houses the Madrilenian headquarters of the Asturian group, the firm has a glimpse of the possibility of definitively unblocking the negotiations between the company and the creditor bank.

Duro has already approved the sale of the aforementioned property to Sabadell. Now the rest of the banking pool just needs to give its approval to the purchase of the building, for which the financial entity will pay between €30 million and €33 million. If this happens, according to sources familiar with the process, the operation could be signed as early as next week. Without further ado. Because time is running out for the Asturian engineering company.

From the sale of the Madrilenian building, Duro would record revenues of €10 million, a deposit that would serve as an emergency guarantee so that, in turn, the creditor banks could release the rest of the avals, amounting to up to €31 million. In this way, the Asturian group would be in a situation to start entering into contracts once again.

It is precisely the lack of avals that has forced the Asturian group to withdraw recently from four projects, with a combined total of €918 million: the Río Grande and Novo Tempo electricity generation centres in Brazil; the LNG terminal for Octopus LNG in Chile; and the hydrocarbon storage terminal for Vopak in Panama. On Tuesday, the company itself acknowledged in a statement presenting its results to the CNMV that “the risk is limiting (the winning of) new contracts and is making it hard to push ahead with projects in the portfolio”. In this way, it justified the losses recorded during the first nine months of the year, which amounted to €11.4 million.

Although it is still pending approval from the other creditors, Sabadell’s proposal for Duro’s Madrilenian building has won favour over the other offer, presented by Sandra Ortega, the eldest daughter of the founder of Inditex, who offered a higher amount: €38 million, but on the condition that the Asturian group remain in the property as the tenant for at least three years.

The option proposed by the financial entity, which operates under the brand Sabadell Herrero in Asturias, is more aligned with the interests of the engineering company, given that the group is also negotiating the sale of the two subsidiaries that work in the building in Madrid.

Although they acknowledge that it is still early days, the firm intends to divest Núcleo Comunicaciones, a division acquired in 2011, which specialises in the defence and air, maritime and environmental control; and Epicom, a firm that has 40 employees for which Duro paid €4.6 million in 2013 and which specialises in the development of security and defence software. Núcleo’s workforce comprises 170 professionals (…).

Leasing operation

In any case, both divisions may continue to occupy the building in Madrid for as long as they form part of Duro Felguer. According to the sources consulted, Sabadell intends to sign a leasing arrangement to allow the Asturian group to continue operating in the property (…).

Original story: El Comercio (by Susana Baquedano, O. Villa and C. Tuero)

Translation: Carmel Drake

Duro Felguera Puts Its Non-Core Properties Up For Sale

4 November 2016 – Expansión

Liquidity crisis / The engineering group has two large corporate headquarters in Madrid and Gijón, which it is looking to sell to cover its financial commitments whilst it resolves several legal disputes overseas.

Duro Felguera explained yesterday during the presentation of its results for the 9 months to September 2016 that it has ordered the sale of its “non-productive assets” to avoid the deterioration of its cash balance whilst it resolves legal disputes overseas for unpaid invoices amounting to more than €300 million. According to the sources consulted, the assets under analysis include the company’s two major headquarters in Madrid and Gijón, the proceeds from which could amount to several tens of millions of euros.

For the time being, the company has issued a sales mandate but has not specified which formula it will use for the divestment. In recent years, many of Spain’s large corporations have sold their headquarters through sale and leaseback contracts, whereby the company sells the property but remains as the tenant for a certain number of years. Ferrovial, Acciona, Prisa, Telefónica, Santander, Gas Natural and Endesa, amongst others, have all used this formula in recent years.

Duro Felguera’s office building in Madrid has been on the company’s balance sheet for two years, after it acquired it for €20 million in 2014. The previous owner was the real estate company GMP. The headquarters is located on Vía de los Poblados, in the north of Madrid, alongside the M-40 ring road and the Campo de las Naciones business park.

Duro Felguera’s headquarters in Madrid has a useful surface area of 13,791 m2. It is an eight-storey building – five of the floors are used for offices, two are used for parking and one contains an undercover space for storage and other facilities.

In Gijón, the company chaired by Ángel Antonio del Valle owns of one of the best complexes in the city’s Scientific and Technological Park. That building has a surface area of more than 9,000 m2.

Legal disputes

Duro Felguera will have to use the proceeds from its divestments to cover several urgent obligations. In December, for example, the company is due to repay a loan amounting to €35 million.

In parallel, the group is looking to encompass its financial commitments into the process of recovering its unpaid invoices overseas. Yesterday, the company stated that “it is holding negotiations with various credit institutions (Bankia, Santander, Popular, BBVA, Sabadell and CaixaBank) to adjust the maturity dates of its debt to bring them in line with the expected resolution dates of these conflicts.

In Australia, the group is fighting against one of its client, the Korean firm Samsung C&T, for overruns on the mining project Roy Hill. The court of arbitrage in Singapore calculates that DF may recover almost €140 million (the last invoice amounted to €40 million, plus €90 million in avals). The Australian courts are claiming €46 million, of which €9 million has been already recovered. In Argentina, Duro is claiming another €150 million for overruns at the power plant in Vuelta Obligado. Finally, in Venezuela, the Government led by Nicolás Maduro still owes the Spanish group €101 million.

Original story: Expansión (by C. Morán)

Translation: Carmel Drake

Three Minority Shareholders Acquire Petit Palace Hotel Chain

19 September 2016 – Cinco Días

The Choice Hotels chain has had the doors to the Spanish hotel market closed in its face. The US group signed a pre-agreement with N+1 in July whereby the investment bank committed to sell its 52% stake in High Tech. Several minority shareholders then also joined the agreement, which is due to expire on 30 September.

However, three of the chain’s minority investors have opted to exercise their right of first refusal and acquire shares from other investors. In this way, on Friday, N+1 announced the sale of 26% of the company that it held through N+1 Dinamia Portfolio II, an operation that, excluding expenses, amounted to €9 million, given that it had valued its stake at €0.

Besides that stake, the investment bank also held another 26% stake in High Tech through several private equity funds, which it has also divested, according to sources familiar with the operation.

The three minority shareholders that now control High Tech are: Inversiones el Piles, an Asturian company that also owns 24.5% of Duro Felguera. It used to own 10% of the hotel chain, but now controls 54%. Alongside it is the company Edificio Miño, a private investment fund linked to one of the shareholders of Seguros Santa Lucía, which previously held 6.5% and now holds 11%; and General Oilex Company, the real estate group originally from Sweden, which has increased its stake from 5% to 35%.

These three investors, which have paid around €40 million for the 78.5% of the company that they did not control, have taken on all of its debt. They had been given the option to exercise their right to accompany the other investors in Choice’s offer or to exercise their right of first refusal; they opted for the latter.

The operation represents N+1’s exit from the hotel chain’s share capital, after it first became a shareholder in 2003. It also sees the departure of the founding executives of the company, which together held a 26.2% stake. On several occasions, some of the founders, such as Antonio Fernández and Javier Candela, expressed their interest in regaining control of High Tech, due to differences in terms of management and they tried to look for financial support from other investment funds. As such, over the last year, they have sounded out buyers including Hotusa.

High Tech operates 31 hotels in Spain, through the Petit Palace brand; it rents the majority and manages the rest. The chain has a strong presence in Madrid, where it manages 20 properties, as well as in Barcelona, Valencia, Sevilla, Bilbao and Málaga. In total, it has 1,966 rooms.

High Tech was launched 15 years ago by the team from Tryp, following the sale of that brand to the Escarrer family (Meliá). The founding team, which the other shareholders subsequently joined, created an urban brand, which suffered during the years of the crisis due to the high price of rentals and high financing costs. Sources in the market suggest that the new owners may be interested in valuing the company for its subsequent sale.

Original story: Cinco Días (by Laura Salces)

Translation: Carmel Drake