Empark’s Owners Engage JP Morgan To Sell The Giant For €850M

19 May 2017 – Expansión

Empark is back on the market. The Portuguese controlling shareholders of the car park company have engaged JP Morgan to find a buyer for an entity worth around €850 million, on the basis of the prices and valuations of other similar transactions in the sector. Empark is the leading car park company in Spain with 500,000 parking spaces in the Iberian Peninsula, the United Kingdom and Turkey. The firm’s gross operating profit (EBITDA) amounts to €65 million and its debt, which the company has been restructuring over the last year, amounts to €475 million.

Following the most recent changes, Empark’s shareholder structure is still dominated by the Portuguese investors Silva & Silva, which own 78% of the company. The second largest shareholder is the Chinese conglomerate Haitong, with a 14% stake.

The company’s control vehicle is dominated by the founding families, who participate in the management of the group. The main executives of Empark are José Augusto Tavares, Pedro Mendes (Executive President) and Antonio Moura.

The last attempt to sell the company was made in 2015. Then, the company progressed to the stage of selecting a buyer, Vinci Park (Ardian), but the operation did not come to fruition. Vinci Park reported the breakdown in its negotiations to buy Empark in July of that year after finalising its due diligence work, which produced unsatisfactory findings. Ultimately, the company was concerned about Empark’s high exposure to town halls which, following the local elections held that year, were considering “re-municipalisation”.

Sources close to the fund Ardian say that they are not interested in the operation at the moment. The infrastructure investment giant put Indigo (formerly Vinci park) up for sale this year for around €3,000 million. The sale of Empark is quite complex, given that the shares of the car park company serve, in turn, to secure the shareholders’ personal loans.

According to sources close to the operation, the Portuguese shareholders have dragged the other shareholders into the sale and have been given until the beginning of October to find a buyer. They are keen to leverage the ‘drag along clause’ set out in the company’s shareholder agreements (which means that when a third party makes an offer to purchase the company by buying all of its share capital, then the shareholder that has the ‘drag along right’ may force the other shareholders to sell their stakes to the buyer).

Sources in the sector believe that if Pedro Mendes and his partners do not find an investor with a reasonable offer in time, Haitong may push ahead with the operation by itself or with one of Empark’s creditor banks. Deutsche Bank is one of the company’s latest lenders. The German bank manages the fund RREEF Infrastructure.

One of the possible candidates to analyse the purchase operation is the fund First State, which acquired España Parkia from the Nordic fund EQT and Mutua Madrileña in 2016 for just over €300 million. The US fund Alinda is also very active in Spain. It has made an offer to buy Isolux’s car park portfolio. Another candidate could be the Chinese firm Haitong

Original story: Expansión (by C. Morán)

Translation: Carmel Drake

Eugenio Hinojosa Resumes Empark Negotiations

13 October 2015 – Expansión

The Spanish businessman Eugenio Hinojosa has resumed his plans to purchase Empark, the leading car park company in Spain and Portugal. The operation could amount to around €900 million, including debt. Hinojosa, one of the largest operators of parking spaces in Madrid, has resumed talks to purchase Empark after exclusive negotiations broke down between the shareholders of the parking company and the funds that control Vinci Park (Ardian and Crédit Agricole), the car park giant in France.

Last week, sources close the operation said that the negotiations are progressing and only a few minor details now need to be resolved relating to avals, guarantees and creditor approvals (mainly bondholders) due to the change in control of the company. “Financing is not a problem”, assured the sources consulted.

Hinojosa plans to join forces with other partners, including the company Andersen Partners, to buy Empark. Empark declined to comment on the matter. Empark’s controlling partner with a 50.3% stake, is Assip, a vehicle named after the Portuguese company A. Silva & Silva, which is in turn controlled by the founding families of the company who participate in the management of the group. The main executives of Empark, which manages 500,000 parking spaces in Spain, Portugal, UK and Turkey, are José Augusto Tavares (Chairman), Pedro Mendes (CEO) and Antonio Moura.

The remaining capital is divided amongst several investment funds, managed by BES (22%) and Ahorro Corporación (8.2%). The Mello family holds a 2.6% stake. In theory, these partners are also selling their respective stakes in the company. Ahorro Corporación’s stake is now being managed by the fund GED Capital.

Political risk

In July, Vinci Park reported that the negotiations to purchase Empark had broken down after the due diligence (audit of the assets) was completed with findings that were not satisfactory. Sources close to the company say that behind the decision was the high exposure that Empark has to town halls governed by parties linked to Podemos following the municipal elections in May.

Eugenio Hinojosa, who is a related by marriage to the founding family of Cortefiel, has been building up a sizeable portfolio of car park assets in Madrid, and now owns more than 12,000 parking spaces. He was one of the main competitors in the tender for the Aena car parks in 2013, but was his offer was outbid by Empark and Saba. He managed to suspend the award after filing a special appeal with the Central Administrative Court of Contractual Appeals against the airport operator’s decision, but then lost the ruling.

In 2014, the controlling shareholders of Empark engaged JPMorgan and Caixa Banco de Investimento (CBI) to find a buyer. One of the reasons for their exit from the company (they purchased it from Ferrovial in 2009) has been the financial problems of its Portuguese partners, which have undergone a complicated bankruptcy process and have had to make loan repayments in recent months.

Empark closed 2014 with sales of €180 million and an EBITDA of €66 million. As well as managing some of the busiest car parks in Madrid, Aena awarded the group the operation of its car parks in the Western region (including Barajas) in 2013, requiring the management of 40,600 parking spaces. Two years ago, the company also won the tender to manage 82,000 ground-level parking spaces in Madrid.

Original story: Expansión (by C. Morán)

Translation: Carmel Drake

Vinci Park In Exclusive Negotiations To Buy Empark For €900M

23 April 2015 – Expansión

Exclusivity / The group controlled by Ardian will purchase the parking space market leader, which has debt of €500 million.

Yesterday, the French company Vinci Park (controlled by the fund Ardian, together with Credit Agricole and Vinci) announced that it had begun exclusive negotiations with the shareholders of Empark regarding the “potential purchase” of the market leading parking space company in Spain and Portugal, which is controlled by Portuguese shareholders. “We are still negotiating to arrive at a final agreement” say sources at Vinci Park. The company is committed to maintaining an investment grade rating.

A few days ago, Empark’s shareholders said that an agreement with Vinci was imminent for the sale of a controlling stake.

Financial troubles

Other investors have expressed interest in Empark, valued at around €900 million (including debt of €500 million), including the Spanish businessman Eugenio Hinojosa who, with the support of several financial institutions, including Santander, designed a purchase offer to compete against the bid made by the French group. Empark will have to explain the transaction to its bondholders in London.

Assips is Empark’s controlling shareholder, with a 50.3% stake – the vehicle is controlled by the Portuguese firm A. Silva & Silva, which is in turn controlled by the founding families of the company who participate in the management of the group.

The top executives at Empark, which manages 500,000 parking spaces in Spain, Portugal, UK and Turkey, are José Augusto Tavares (Chairman), Pedro Mendes (CEO) and Antonio Moura.

The remaining capital is divided amongst several investment funds managed by BES (22%) and Ahorro Corporación (8.2%). The Mello family holds a 2.6% stake. These shareholders will also sell (their stakes) to Vinci Park.

Other movements

The controlling shareholders commissioned JPMorgan and Caixa Banco de Investimento (CBI) to search for a buyer in 2014. One of the reasons for exiting the company (which they acquired from Ferrovial in 2008) has been the financial troubles of the Portuguese shareholders, which have been going through a complicated bankruptcy process and have had to deal with debt maturities in recent months.

Empark recorded sales of €180 million in 2013 and a gross operating profit (EBITDA) of €63.3 million. During the first three months of 2014, Empark recorded turnover of €42.8 million, down 0.6% (on the previous year) and a gross profit of €15.3 million, in line with 2013. Vinci Park, which has operated in Spain since 1994, manages 39 car parks in various cities across the country. The company also has a presence in a further thirteen countries and generates total revenues of €704 million.

The sale of Empark coincides with the decision by KKR, Torreal and ProA to sell 49% of Saba.

Original story: Expansión (by C.Morán and D.Badía)

Translation: Carmel Drake

Vinci Park Finalises Its Purchase Of Empark For €900m

23 February 2015 – Cinco Días

The Vinci Park group is finalising its acquisition of the Hispanic Portuguese car park company Empark, in a transaction worth around €900 million. As a result of the purchase, Vinci Park will become the market leader in car park management, in Europe at least.

According to sources familiar with the transaction, Empark’s fragmented shareholder structure has made the negotiations, which began in the middle of last year, more difficult. “Loose ends still need to be tied up, a deal is not imminent”, they said. However, other sources indicated that “practically 95% of the transaction is closed”. Empark’s main shareholders are the Portuguese groups Assip Consultoria e Serviços (50.3%); Es Concessions International Holding (22.21%); and the Espirito Santo Infraestructure Fund (8.27%). The Spanish entity Ahorro Corporación owns more than 8% of the capital, in which other minority shareholders also hold a stake. Ferrovial sold its concessionary subsidiary Cintra (now Empark) to the Portuguese groups and Ahorro Corporación for €451 million in 2009.

According to Empark’s 2013 accounts, the latest ones available at the Commercial Registry, the company manages 500,763 parking spaces in total in: Spain (387,494); Portugal (68,679); UK (37,554); Turkey (5,861); Andorra (825); and Poland (350). The entity employs 2,527 people.

Empark began 2013 with long-term debt of €503 million and short term debt of €50.7 million. The company refinanced its debt in December 2013 through a bond issue amounting to €385 million, which is due to be repaid in December 2019. Empark used this new debt to repay the syndicated bank debt it held with Banco Espiritu Santo de Investimento as the agent bank, which amounted to €392.7 million, including interest.

In 2013, Empark recorded losses of €11.9 million (losses of €9.2 million in 2012) and revenues of €177.8 million (€180.9 million a year earlier).

French fortitude

Vinci Park manages 1.8 million parking spaces in 14 countries. Its parent company, the Vinci Group, which also operates concession and construction businesses, employs 191,000 people and has an annual turnover of almost €40,000 million.

The French investment giant Ardian, formerly Axa Private Equity, and Crédit Agricole Assurances, acquired Vinci Park last July, with each one taking a 37.5% stake in the car park company’s share capital, in a transaction worth around €1,960 million. Vinci Concessions retained a 25% stake.

The Vinci Group recorded profits of €2,486 million in 2014, after its results were boosted by the sale of the majority of its car park business, according to reports by the French multinational on 6 February.

Last year, the company Ardian closed an investment fund amounting to €10,000 million. The entity is the primary shareholder of CLH in Spain with a 15% stake. In 2014, it acquired 65% of Túnels Barcelona Cadi’s share capital, which operates the Vallvidrera and Cadí Tunnels, from the Brazilian bank BTG Pactual for €146 million; Abertis, which partners Ardian in other projects in Spain and France, controls the remaining 35% of Cadí’s capital.

Original story: Cinco Días (by Alberto Ortín Ramón)

Translation: Carmel Drake