DealMaker Q&A

Posted on

TTR DealMaker Q&A with Auriga Global Investors Head of Derivatives and Alternative Investments Diego García de la Peña

Diego García de la Peña is Head of Derivatives and Alternative Investments, as well as Head of Hedging Consulting for Private Equity funds, infrastructures, real estate, family offices, and companies in Auriga Global Investor. In both activities, the aim is providing solutions for companies’ capital structures and helping them, as well as supporting sponsors to develop their business plans.

_____________________________________________

TTR: 2018 was a record year regarding Private Equity investment, how has it been in 2019? What can we expect for 2020? 

D.G. P.: In 2019 all historical records were broken again in Spain with a volume of investment close to 8.5 billion euros compared to 6 billion euros in the previous year (+41% year-on-year increase), according to Ascri’s data. Furthermore, the number of megadeals (transactions over 100MM EUR) has increased from 8 transactions in 2018 to 18 in 2019. In our case, the activity has been very positive, since we have advised some of the most relevant players in the sector, such as the private equity fund MCH in the management of the interest rate riskof Grupo Palacios’ financing, or the management company ICG in the management of the interest rate hedging of Konecta’s financing. 

Unfortunately, 2020 has started as a year of total uncertainty due to the situation in which we find ourselves in a global health and economic alert. Initially it was starting as a good year of investment, perhaps with volumes not as high as previous years but with a good deal flow but now we will have to see the evolution of the crisis and above all its geographical range and temporal evolution. 

TTR: In recent months you have advised relevant players like Plenium Partners or MCH Private Equity, could you give us any comments about the most relevant transactions? 

D.G. P.: Plenium Partners has executed several transactions in recent months, being one of the most active market participants in the renewable energy sector. On the one hand, Rewind Energy V, a company controlled by Helia Renovables, acquired Sun European Investments Eólico Olivillo, a company that owns two 53.5 MW wind farms in Jerez de la Frontera, as well as three photovoltaic plants. Auriga advised on interest rate hedging in the refinancing. In addition, Tescobor Spain, controlled by Helia Renovables, acquired San Clemente Solar Project, owner of two solar farms in Spain, which have an aggregate capacity of 10 MW. In this transaction, Auriga advised on the interest rate hedging for the refinancing of the park. 

We can also highlight the purchase by Global Tholos, controlled by MCH Private Equity, Ardian, and LGT European Capital, of 100% of Palacios Alimentación in the American company Carlyle. Auriga advised MCH on the interest rate hedging associated with the financing of the Palacios Alimentación acquisition. 

TTR: What sectors do you consider as more active in M&A and Private Equity in recent months and currently? 

D.G. P.: One of the sectors that is experiencing a lot of activity is the renewable energy sector. On the one hand, in the parks already in operation fuelled by the new decree approved by the government guaranteeing profitability until 2031, which gives regulatory and economic stability to investors, as we have experienced on T-Solar’s portfolio refinancing of 23 PV plants deal last December. On the other hand, in the development and construction of new parks, a segment in which we are seeing many operations. 

Another sector that we believe will be very active is the agri-food sector. The entry of Private Equity funds allows the consolidation of this sector which is controlled by small family businesses generally, benefiting from economies of scale. In addition, they can provide professionalization in management, organic growth or boost internationalization. 

Finally, we believe that the Healthcare sector will continue to be very attractive for Private Equity, in areas such as pharmaceuticals, medical technology, hospitals and elderly care. As mentioned in the agribusiness sector, consolidation is one of the value levers, as is the demographic factor due to the ageing population or the improved efficiency of health services. 

TTR: Alternative financing has definitely gained traction in Spain, what can we expect in following years? 

D.G. P.: Alternative financing is seen as something normal in Spain already, both by the business sector and by the banking sector and this normalization is a very important tombstone. Companies no longer see debt funds as exclusively opportunistic source of finance and banks incorporate them as co-financiers in a wide range of operations. 

In the next few years, we expect an increase in sponsorless transactions, as up to now most alternative debt operations have been sponsor-driven. With the increase of alternative financing funds present in Spain, as well as with the reduction of company size and minimum financing amounts as requisites to carry out operations, we believe that there will be a shift towards non-sponsor driven operations. 

We also believe that there will be a greater segmentation of alternative financing operations between pure growth senior bullet financing in high-performance companies, hybrid debt for companies that need a mixed debt-equity solution or special situation financing. 

We will have to be alert to the evolution of the crisis and the liquidity situation with which companies come out of it in order to support them in specific stress situations. 

TTR: Regarding Hedging strategies for Private Equity financing and portfolio companies, what trends can you highlight? 

D.G. P.: Currently, we think it is interesting to hedge with caps instead of traditional hedging with swaps, although the volatility of the former has increased significantly due to the crisis, which has resulted in an increase in premiums. Likewise, it is still interesting, in the case of hedging with swaps, to utilize forward starting swaps in order to avoid low interest rates when the outstanding capital is higher. 

As for currency hedges, we are seeing greater and longer-term planning by the acquiring funds in conjunction with the financial teams of the portfolio companies, like we have experienced with Riverside in the hedging of La Galvanina deal. 

TTR: We are in the midst of one of the major crises and pandemics in history due to COVID-19, right at a very good moment for Private Equity and M&A. In the mid-term, how it´s going to affect the market? 

D.G. P.: We at Auriga believe that it is tremendously important to see the extension in time of the crisis at a global level. If it were a one-off problem, being it totally dramatic, but one that can be overcome in 2-3 months, we believe that the impact will be limited and recovery will be quick, although we also think that it is difficult to reach previous levels. On the other hand, if, as it seems, it is going to be a problem that extends over time because it is affecting different parts of the planet in different phases and consecutively, we believe that the consequences are unpredictable and more far-reaching. 

In the medium term, we believe that it will be important for companies and financiers to have flexibility to find imaginative solutions to the liquidity and financial structure problems that will arise, in order to offer stability to the productive system. 

We also believe that it will be a market that will provide interesting opportunities for those participants who have funds available but, on the other hand, it will be an environment in which fund-raising might prove difficult because investors may have a lower valuation of their assets due to the fall in positions in organised markets and, therefore, less money available in absolute value for allocation to alternative investment.

DealMaker Q&A

Posted on

TTR DealMaker Q&A with Ecija Partners Javier Bustillo, Leticia Domínguez, Emilio Prieto and Yolanda Lobao

Ecija Partners:
Javier Bustillo: Corporate / M&A and Venture Capital Partner.
Leticia Domínguez: Corporate / M&A, Innovation & Entrepreneurship, Media Partner.
Emilio Prieto: M&A / Private Equity Parter.
Yolanda Lobao: Private Client, Litigation, Real Estate, Corporate Partner.

_____________________________________________

TTR: Based on the closing of 2019 and taking into consideration the beginning of 2020, what are your expectations for the Spanish M&A market this year?

E: 2019 was a positive year for the Spanish M&A market and we are optimistic for 2020, since all indicators predict a year with a lot of investment activity. Despite of the possible economic slowdown, the available liquidation and the permanent arrival of foreign investment, along with positive growth expectations and profitability of Spanish companies, allow us to anticipate a very positive outlook in the Spanish M&A market. 

In addition, the leading role that private equity funds have acquired in the closing of corporate transactions is remarkable. We continue to see interest in acquiring stakes in technology and disruptive companies; as well as an appetite for quality assets in the market. All these factors lead us to expect a transactional activity improvement.

For us, 2020 begins with dynamism, as we are leading transactions in booming sectors such as technology and media, with a clear commitment from all investors who have good financing and perceive positive signals and cracking Spanish companies. 

TTR: Real Estate is a cornerstone of Spain’s M&A market. What can we expect in this sector in 2020?

E: It is foreseen that the increase of property sales will continue during 2020, although on a more stable basis than previous years. Factors such as diversifying investments in different countries and the existence in Spain of a Golden Visa program, will continue to contribute the growth of foreign investments. Golden Visa in Spain is a fast way to obtain an Authorization of Residency for an investment of a minimum of 500.000 € which allows to non-EU citizens and their families to live and work in Spain.  

Globalization and new ways to spend holidays abroad have certainly changed the real estate industry in Spain. People seek now, not only a pure relaxing time on the beach, but to carry out interesting activities involving healthy food, physical exercise, sports leisure, and psychological -stress free- break. In order to carry out these activities inside a property, certain licenses could be required, and activity use would have to be allowed.

The major challenge for cities is the appearance of the global co-living phenomenon which is forcing authorities to regulate the use of rentals of a long-term sharing flats (without being considered hotels, pensions or bed & breakfasts), the urge of regulation is a fact.

In addition, we will see in the next years if implementation of blockchain and smart contracts will change and facilitate real estate and rental property transactions. 

TTR: What are your views for the Spanish Private Equity market in 2020? Which sectors do you expect investors will target more?

E: We expect a good year in terms of private equity due to the large number of funds available and low interest rates. These circumstances are allowing us to face a cycle with a great appetite for purchasing. Furthermore, we must highlight Spain’s advantageous position as a result of having first-class companies at more affordable purchase prices than in other European Union countries. 

We observe that opportunities in private equity and mid-size markets arise, both in the more traditional sectors and in those in which the technological disruption has had, and is expected to have, an important impact by taking advantage of big data, artificial intelligence and machine learning. Investors clearly are interested in these areas, which are so intensely linked to innovation and digital transformation. Indeed, innovation is nothing more than the transformation of their business. Investors know that consumer markets are highly competitive and both potential buyers as well as investors are eager to find targets that really make a difference.

Finally, and precisely in certain sectors in which it has grown with a high degree of leverage, we also see an activation of the turnaround market, which we are sure will become more present in the near future.

TTR: And what about Venture Capital? Can we expect a new increase in this segment? Will the technology sector be the most targeted again?

E: No doubt about it, the venture capital will continue increasing its size. This segment is in a process of accelerated maturation in Spain. Even though it is far from achieving the same scope as in countries like United Kigndom or Germany, we must recognize a very solid growth in recent years. 

Also, we are seeing how every day there are more investments in venture capital and the liquidity available at the moment is boosting diversification. This situation is turning out to be a major advantage for venture capital.  

Technology has become the central axis of almost all business’ models, so it will continue to be a crucial part in M&A processes, since the acquisition of technology has become the way to invest in innovation. Technology is one of the sectors that we know well at ECIJA and thus, we have seen large operations in recent years.

TTR: ECIJA just signed a global alliance with China-based Grandall Law Firm. Could this agreement boost Chinese investment in Spain? Do you expect an increase in the interaction between China-based and Spain-based companies?

E: Last October 2019, ECIJA signed one of the most ambitious international joint ventures in the legal sector with China’s fifth largest firm, Grandall Law. This agreement resulted in the merge of the China-Spain-Latin America triangle, bringing together more than 3,500 lawyers in 18 countries in a total of 54 offices.

Currently, despite the global decline in Chinese investments in 2019, China remains the third export country and the seventh import country with Spain and there are many Chinese projects that are being executed in Spain. The outlook for 2020 is positive, which will be driven by the easing of trade tensions between the US and China. This factor will facilitate Chinese investment abroad, including Spain. In addition, another factor that will help is the increase of Chinese investment appetite, taking into account that liquidity conditions in the Chinese economy have improved slightly throughout 2019. Also, favorable conditions will be boosted by the implementation of new rules for evaluating foreign investments in the US and Europe.

In this investment map, Spain has positioned itself in a beneficial spot, since our country is seen for China as connection vehicle for Chinese companies to establish themselves throughout Europe and Latin America. In this regard, while in 2019 Chinese investments decreased globally, they did increase in Latin America, especially in sectors such as energy and transport.

TTR: According to TTR data, the interaction between companies from Latin America, a region where ECIJA recently made investments to increase its presence, and from Spain is lower than the interaction between European companies and Spain-based companies, and lower too than the interaction between US-based companies and Spain-based companies. What are the reasons?

E: First of all, it is important to highlight that Spanish investment in Latin America has had multimillion dollar figures in recent years. It is the second most important in the world after the United States. Between 1993 and 2015, the gross investment accumulated by Spanish companies exceeded 207,000 million euros (the equivalent of 20% of national GDP). At the same time, Spain is the main European destination for Latin American investments.

Secondly, our customers’ commitment to the Latin American market is clear. For many Spanish companies it is their natural leap and it is also for companies in other countries (China, USA, UK, among others) that see in Spain the gateway to the American continent. Our role is to accompany them in the region landing in the most integrated way possible. From ECIJA, we are noticing Spanish clients who obtained more income in Latin America than in Europe. For this reason, the Firm wants to be present in these regions, in addition to the cultural and linguistic links between Spain and Latin America.

Therefore, the interaction between companies in Latin America and Spain remains active and the presence of Spanish companies in Latin America continues. Although it is worth emphasizing that Spanish companies might be cautious when investing in these regions due to the influence of the global economic environment. By contrast, the US economy performance is excellent, driven primarily by the effects of tax reform, exceeding nine years of the expansive economic cycle and unemployment rates to unknown levels since 1969.

_____________________________________________

Versión en español

_____________________________________________

Socios de Ecija:
Javier Bustillo: Socio Corporate / M&A y Venture Capital de ECIJA Madrid.
Leticia Domínguez: Socia Corporate / M&A, Innovación y Emprendimiento, Media.
Emilio Prieto: Socio M&A / Private Equity.
Yolanda Lobao: Socia Private Client, Inmobiliario, Procesal, Civil.

_____________________________________________

TTR: Viendo el cierre del año 2019, y teniendo en cuenta el inicio de 2020, ¿Qué sensaciones tienen para este año sobre el mercado de M&A en España? 

E: 2019 fue un año positivo para el mercado español de M&A y somos optimistas para 2020, ya que todos los indicadores predicen un año con mucha actividad inversora. La liquidez disponible y la permanente llegada de inversión extrajera, unido a unas expectativas positivas de crecimiento y rentabilidad de las empresas españolas, permiten anticipar un panorama muy positivo en el mercado español de M&A, pese a la posible desaceleración económica. Además, cabe recalcar el protagonismo que han adquirido los fondos de private equity en el cierre de transacciones corporativas. Seguimos viendo interés por adquirir participaciones en compañías tecnológicas y disruptivas; así como un apetito por activos de calidad en el mercado. Todo esto nos lleva a esperar una mejora de la actividad transaccional. 

Para nosotros, 2020 comienza con dinamismo, ya que estamos liderando transacciones en sectores en auge como la tecnología y los medios de comunicación, con una apuesta clara por parte de todos los inversores que cuentan con buena financiación y perciben señales positivas de crecimiento y rentabilidad en las empresas españolas. 

TTR: En el mercado transaccional español el sector inmobiliario es sin duda un pilar fundamental, ¿qué cabe esperar de este sector en 2020? 

E: Prevemos una continuación del aumento de ventas de propiedades durante 2020, aunque de manera más estable que en años anteriores. Factores como la diversificación de las inversiones en diferentes países y la existencia en España de un programa “Golden Visa” continuarán contribuyendo al crecimiento de las inversiones extranjeras. En este sentido, la Golden Visa en España se ha convertido en un vehículo rápido para obtener una Autorización de Residencia, bajo una inversión mínima de 500.000 €. De este modo, permite vivir y trabajar en España a los ciudadanos de fuera de la UE, así como a sus familiares.

La globalización y las nuevas formas de pasar las vacaciones en el extranjero sin duda han cambiado la industria inmobiliaria en España. Los extranjeros no solo buscan un turismo puramente de playa, sino realizar actividades interesantes que involucren comida saludable, ejercicio físico, ocio deportivo y descanso psicológico sin estrés. Para llevar a cabo estas actividades dentro de una propiedad, se podrían requerir ciertas licencias.

Para 2020, el principal desafío para las ciudades es la aparición del fenómeno global de coliving, que está obligando a las autoridades a regular el uso de alquileres de pisos compartidos a largo plazo (sin ser considerados hoteles, pensiones o bed & breakfast). Además, veremos en los próximos años si la implementación de blockchain y los contratos inteligentes cambian y facilitan las transacciones de bienes raíces y propiedades de alquiler.

TTR: ¿Qué perspectivas tienen respecto a operaciones de Private Equity para este año? ¿Qué sectores se perfilan como importantes para los inversores? 

E: Esperamos un buen año en términos de private equity, debido al gran número de fondos disponibles y a los bajos tipos de interés, circunstancias que hacen que nos encontremos ante un ciclo con gran apetito de compra. A esto a hay que añadir la posición ventajosa de España como consecuencia de disponer de empresas de primer nivel a unos precios de compra más afrontables que en otros países de la Unión Europea.

Observamos que en los mercados de private equity y en el de mid-size se ofrecen oportunidades, tanto en los sectores más tradicionales como en aquellos otros en los que la disrupción tecnológica ha tenido, y es de esperar tenga, un impacto importante, aprovechándose de big data, inteligencia artificial y machine learning. Los inversores claramente apuntan a estos ámbitos, tan intensamente relacionados con la innovación y transformación digital, que no es más que la transformación de su negocio, pues saben que los mercados de consumo son altamente competitivos y tanto los potenciales compradores de naturaleza industrial como los inversores están deseosos de encontrar targets que realmente marquen la diferencia.

Por último, y precisamente en ciertos sectores en los que se ha crecido con alto grado de apalancamiento, vemos también una activación del mercado de turnaround, que estamos seguros se hará más presente en próximas fechas. 

TTR: ¿Y respecto a Venture Capital? ¿Veremos un nuevo repunte de este segmento de mercado? ¿Seguirá el sector tecnológico copando la mayor parte de las operaciones? 

E: Sin lugar a duda el venture capital seguirá incrementando su tamaño que se encuentra en un proceso de maduración acelerada en España y que, aunque lejos de países como Gran Bretaña o Alemania, debemos reconocer un crecimiento muy sólido en los últimos años. Cada día hay más inversiones en venture y la liquidez disponible en estos momentos invita a la diversificación, resultando en que el venture capital sea uno de los grandes beneficiados. 

La tecnología se ha convertido en el eje central de casi todos los modelos de negocio por lo que seguirá siendo una pieza capital en los procesos de M&A, ya que la adquisición de tecnología se ha convertido en la forma de invertir en innovación. La tecnología es uno de los sectores que conocemos bien en ECIJA y hemos observado grandes operaciones en los últimos años.

TTR: ECIJA acaba de firmar una alianza global con el despacho chino Grandall Law Firm. ¿Abre esto aún más la puerta de entrada al mercado transaccional español del inversor chino? ¿Desde ECIJA se espera un incremento de la interacción entre empresas chinas y empresa españolas? 

E: El pasado mes de octubre de 2019, ECIJA protagonizó una de las joint ventures internacionales más ambiciosas del sector legal con la quinta firma más grande de China, Grandall Law. Este acuerdo resultó en la unión del triángulo China-España-Latinoamérica, aglutinando a más de 3.500 abogados repartidos en 18 países en un total de 54 oficinas.

En la actualidad, a pesar del descenso global de las inversiones chinas en 2019, China sigue siendo el tercer país de exportación y el séptimo país de importación con España y hay muchos proyectos chinos que se están ejecutando en España. Las perspectivas para 2020 son favorables, impulsadas por el alivio de las tensiones comerciales entre EE.UU. y China, que facilitará la actividad inversora china en el extranjero, incluyendo a España. Además, otro factor que ayudará es el aumento del apetito inversor chino, dado que las condiciones de liquidez en la economía china han mejorado ligeramente a lo largo del 2019, o la implementación de nuevas reglas de evaluación de las inversiones extranjeras en EE.UU. y Europa.

En este mapa de inversión, España se sitúa en una posición beneficiosa, ya que nuestro país es para China un vehículo de conexión para que empresas chinas se establezcan en Europa y Latinoamérica. En este sentido, mientras que en 2019 las inversiones chinas disminuyeron a nivel global, en América Latina aumentaron, con especial interés en sectores como energía y transportes. 

TTR: Según los datos de TTR, la interacción entre empresas de Latinoamérica, región en la que ECIJA también ha realizado inversiones recientemente para ganar presencia, y de España es inferior a la interacción entre empresas europeas y empresas españolas, e incluso a la interacción entre empresas estadounidenses y empresas españolas. ¿Cuáles son los motivos? 

E: En primer lugar, es importante destacar que la inversión española en América Latina ha alcanzado cifras multimillonarias en los últimos años. Es la segunda más importante del mundo tras la de Estados Unidos. Entre 1993 y 2015 la inversión bruta acumulada por las empresas españolas superó los 207.000 millones de euros (el equivalente al 20% del PIB nacional). Al mismo tiempo, España es el principal destino europeo de las inversiones latinoamericanas. 

En segundo lugar, la apuesta de nuestros clientes por el mercado latinoamericano es clara. Para muchas empresas españolas es su salto natural y también lo es para empresas de otros territorios (China, EE.UU., Gran Bretaña, etc.) que ven en España la puerta de entrada al continente americano. Nuestro rol es acompañarles en ese desembarco en la región de la manera más integrada posible. Desde ECIJA, estamos observando clientes españoles que obtienen más ingresos en América Latina que en Europa. Por este motivo, la Firma quiere estar presente en estas regiones, además de aprovechar los vínculos culturales y lingüísticos entre España y América Latina.

Por tanto, la interacción entre empresas de Latinoamérica y de España sigue siendo activa y sigue aumentando la presencia de las empresas españolas en Iberoamérica. Si bien cabe hacer hincapié que las empresas españolas se muestran cautas a la hora de invertir por la influencia del entorno económico global en la región. En cambio, esto contrasta con el excelente desempeño de la economía norteamericana, impulsada principalmente por los efectos de la reforma fiscal, superando los nueve años de ciclo económico expansivo y llevando las tasas de desempleo hasta niveles desconocidos desde 1969. 

DealMaker Q&A

Posted on

TTR DealMaker Q&A with Kreab corporate and financial communications Partner Pablo Zamorano

Pablo Zamorano is a partner within the corporate and financial communications departments of Kreab in Spain. He specialises in corporate and financial communication with experience in media and communication strategies (external and internal), as well as in steering committees training. Pablo has 15 years of experience in communication consulting, advising national and international companies from different activity sectors.

_____________________________________________

TTR – How would you describe Spain’s transactional activity at the beginning of 2020? Do you find any differences with regards to 2019?

P. Z. – At Kreab we believe that the mid-market will continue to perform well in Spain in the coming years. This good behaviour will be encouraged both by the attractiveness of the Spanish companies -which have to increase their size to bridge the gap with the European average-, and also because there is a lot of liquidity in the market and financing facilities, both for private capital funds and industrial buyers.

On the other hand, the future of megadeals is always uncertain, as they depend on several factors in order to be closed. In any case, it is well known that there are large international funds with their sights set on Spain that are looking for large companies in which to invest their capital.

TTR – Within the Spanish M&A transaction market, who is the target of a communications consulting firm? What type of corporate transactions usually require the presence of a communications advisor?

P. Z. – As a communications and public affairs consultancy firm, Kreab’s targets are both companies that want to carry out any kind of financial transaction as well as private capital funds. Additionally, many law firms and investment banks are increasingly relying on us to offer an integrated advisory service to their clients. This is because communication has become a strategic factor when closing transactions, both from an external communication point of view -with shareholders, investors, journalists and the market in general- and from an internal communication point of view.

In general, the more complex an operation is and the greater the number of actors involved, the more important it is to use communication as a tool for all stakeholders to know, understand and value the rationale of the deal. Without a doubt, communication is a key element to improving a company’s reputation and perception, helping to send a signal to the market that the asset is for sale or that the sector is booming, thus attracting a greater number of buyers and creating an environment that should have a positive impact on the final price paid for the company. In today’s world, communication adds value to financial transactions.

TTR – Which elements of the communications advisory process do your clients in the M&A sphere value the most? Why?

P. Z. – One of the aspects that Kreab’s M&A clients value the most is our 360° view of how financial transactions are structured. On the one hand, we integrate communication in a global way and we adapt it to all stakeholders, developing not only external but also internal communication techniques (the internal audience is increasingly a key factor in the success of transactions), as well as managing institutional and regulatory issues. In addition, we coordinate with legal and financial advisors as an additional element of the team that contributes to the success of the transaction.

Another aspect that our clients highlight is our experience and knowledge, not only of communication issues but also of financial aspects, which enables us to offer unique, comprehensive and specialized advisory services, which are difficult to find in other communication consultancy firms in the market.

Finally, I would like to emphasize that we have an extensive network of contacts based on trust and professionalism with the key journalists who cover the sector, both nationally and internationally.

TTR – Would you say there is a growing demand for communications consulting services in M&A transactions? Why?

P. Z. – Every year, Kreab advises on an increasingly greater number of M&A transactions, making it the communications consultancy firm that has advised on the highest number of transactions in Spain in recent years. This is because we have clients who have trusted us for more than 15 years and, when they see the positive results of our work, they recommend us in the market. This has enabled us to build a steady portfolio of more than 60 financial communication clients, as well as other clients who hire us for specific projects.

Our vision is that the demand for specialized communication services will continue to grow steadily in a world that is increasingly interconnected and in need of conveying transparency and a sound business practice in a coordinated manner between the different actors and regions involved. In this sense, it is also important to highlight that Kreab has a network of 25 offices worldwide, with a strong presence in Latin America (Colombia, Chile, Ecuador, Peru, Bolivia, among others) and with specialized teams that offer this service on a global basis.

_____________________________________________

Versión en español

_____________________________________________

Pablo Zamorano es partner de comunicación corporativa y financiera de Kreab en España. Está especializado en comunicación corporativa y financiera con experiencia en relación con medios y establecimiento de estrategias proactivas de comunicación para clientes. Cuenta con casi 15 años de experiencia en consultoría de comunicación, asesorando a clientes nacionales y multinacionales de diversos sectores, también del Ibex35 (Telefónica, BBVA, etc.).

_____________________________________________

TTR – ¿Cómo describiría la actividad del mercado transaccional español en el inicio de 2020? ¿Percibe diferencias con 2019?

P. Z. – Lo que creemos desde Kreab es que el mid-market continuará registrando un buen comportamiento en España en los próximos años animado tanto por el atractivo de las empresas, que tienen como tarea pendiente ganar tamaño para acercarse a la media europea, y también porque hay mucha liquidez en el mercado y facilidades de financiación, tanto para los fondos de private equity como para los compradores industriales.

Por otro lado, los megadeals siempre son una incógnita, ya que dependen de varios factores para poder cerrarse. En cualquier caso, es conocido públicamente que existen grandes fondos internacionales con la vista puesta en España que están buscando activos de gran tamaño para invertir su capital.

TTR – Dentro del mercado transaccional español, ¿cuál es el público objetivo de una consultoría de comunicación? ¿Qué tipo de operaciones corporativas suelen requerir la presencia de un asesor de comunicación?

P. Z. – El público objetivo de Kreab como consultora de comunicación y asuntos públicos son tanto compañías que quieran realizar cualquier tipo de operación financiera como los propios fondos de capital privado. Asimismo y cada vez más, muchas firmas de abogados y de banca de inversión confían en nosotros para poder ofrecer un servicio integrado de asesoramiento a sus clientes. Esto se debe a que la comunicación se ha convertido en un factor estratégico a la hora de cerrar operaciones, tanto desde un punto de vista de comunicación externa, con accionistas, inversores, periodistas y el mercado en general, como de comunicación interna.

Por lo general, mientras más compleja es una operación y a medida que existe un mayor número de actores involucrados, más importante es utilizar la comunicación como una herramienta para que todos los stakeholders conozcan, entiendan y valoren el sentido de la operación. Sin duda la comunicación es clave en la mejora de la reputación y la percepción de una empresa, ayudando a lanzar al mercado la señal de que el activo está en venta o que el sector está en auge, atrayendo de esta manera a un mayor número de compradores y generando un entorno que debería repercutir positivamente en el precio final pagado por la compañía. Hoy la comunicación aporta valor a las operaciones financieras.

TTR – ¿Qué elementos del asesoramiento en materia de comunicación valoran más vuestros clientes del mundo M&A? ¿Por qué?

P. Z. – Uno de los aspectos que más valoran los clientes de Kreab de M&A es nuestra visión 360º de cómo se estructuran las operaciones financieras. Por un lado, integramos la comunicación de una manera global y adaptada a todos los stakeholders, tocando no solo la comunicación externa sino también la interna (el público interno cada vez más es un factor clave en el éxito de las transacciones), así como la gestión de las cuestiones más institucionales y regulatorias. Además, nos coordinamos junto a asesores legales y financieros como una pieza más del equipo que contribuye al éxito de la transacción.

Otro aspecto que también destacan nuestros clientes es nuestra experiencia y conocimiento, no solo de temas de comunicación sino también de aspectos financieros, lo que nos permite ofrecer un asesoramiento global y especializado único, difícil de encontrar en otras consultoras de comunicación del mercado.

Por último, destacaría que gozamos de una amplia red de contactos basada en la confianza y la profesionalidad con los periodistas clave que cubren el sector, tanto a nivel nacional como internacional.

TTR – ¿Diría usted que existe una demanda creciente de consultorías de comunicación en operaciones de M&A? ¿Por qué?

P. Z. – En Kreab cada año asesoramos un mayor número de operaciones de M&A, lo que nos posiciona como la consultora de comunicación que más transacciones asesora en España durante los últimos años. Esto se debe a que tenemos clientes en nuestra casa que confían en nosotros desde hace más de 15 años y ellos, a su vez, al ver los resultados positivos de nuestro trabajo nos recomiendan en el mercado, lo que nos ha permitido construir una cartera fija de más de 60 clientes de comunicación financiera, así como otros clientes que nos contratan para proyectos puntuales.

Nuestra visión es que la demanda por servicios de comunicación especializados seguirá creciendo de forma sostenida en un mundo que se encuentra cada vez más interconectado y necesitado de transmitir transparencia y solidez de una manera coordinada entre los diferentes actores e incluso regiones que intervienen. En este sentido, también es importante destacar que Kreab cuenta con una red de 25 oficinas en todo el mundo, con una fuerte presencia en Latinoamérica (Colombia, Chile, Ecuador, Perú, Bolivia, entre otros) y con equipos especializados que ofrecen este servicio de manera global.

4Q19 Energy Sector Spotlight – Latin America

Posted on

LatAm Energy M&A Up Overall in 2019 Real Estate sector leads Spanish transactional market, although 17.07% falls until December 

  • Deal volume down in Argentina and Mexico YoY
  • Oil and gas transactions dominate regionally, despite 65% decline in Mexico
  • Solar transactions outpace oil and gas deals in Chile, notwithstanding overall decrease in renewable deals
  • Power sector transactions increase throughout the region, except in Brazil

Madrid, 31 January, 2020. Deal volume in the energy sector across Latin America is down 5% to the close of 4Q19, while aggregate transaction value increased 153% over the same 12 months last year according to Transactional Track Record data.

Volume and aggregate value of energy sector in LatAm. December 2018 to December 2019. Source: Transactional Track Record

Brazil leads by the sheer number of energy deals across the region with 129 transactions, followed by Chile, which registered the sharpest upswing in aggregate value with a 190% increase to USD 2.9bn.

Colombia ranks third by number of energy deals with 27 for the year, followed by Argentina with 25 and Peru with 15.

Mexico is in last place among the top six M&A markets in the region, registering a 65% decline in energy sector transactions with just 13 deals to the close of 4Q19.

Oil and gas transactions lead energy sector deal volume in the top six M&A markets, with the exception of Chile and Peru, where the number of transactions in the power sector outpaced extractives.  In the case of Colombia, the oil and gas and power sectors were at par with seven deals apiece for the year.

Conventional energy deals outpaced renewables in every market except Chile, where there were more solar transactions than oil and gas deals, despite a 33% drop in the number of solar energy transactions over 2018.  Investment in wind assets fell across the board, except in Colombia, where wind deals increased markedly over 2018.

Buyers based in the EU led inbound dealmaking in the energy sector for the year, with 53 transactions, followed by North American bidders, with 33 deals, ahead of buyers out of Asia, with 15 deals. The US led inbound energy investments in Brazil, Colombia and Mexico, the UK led inbound energy deals in Argentina, Colombia led energy investments in Peru and France dominated in Chile.

Mattos Filho, Veiga Filho, Marrey Jr. e Quiroga Advogados tops the regional ranking with 14 transactions, while Machado, Meyer Sendacz e Opice Advogados leads by aggregate value on deals totaling just under USD 9bn.

Banco BTG Pactual led energy sector dealmaking regionally in 2019 with 11 transactions worth a combined USD 1.24bn. Banco Santander leads by aggregate value, its three deals worth USD 8.83bn in aggregate.

More information:

Oliver Hill
TTR – Transactional Track Record
http://www.ttrecord.com/es/sobre-nosotros/
oliver.hill@TTRecord.com 

TTR is a premium financial technology platform that delivers unrivalled transactional data and actionable market intelligence in real time, empowering professionals to seize opportunities and make more informed strategic decisions. TTR aggregates transactional data from thousands of sources, providing an indispensable resource of announced, completed and cancelled transactions covering every industry.

DealMaker Q&A

Posted on

TTR DealMaker Q&A with PPU Peru Partner Rafael Boisset

Rafael Boisset, Partner in Philippi Prietocarrizosa Ferrero DU & Uría Perú, is an expert in corporate matters as well as mergers and acquisitions of private and listed companies in various industries of economy, representing both sellers and buyers. He has advised significant clients by his active participation in the strategic planning of acquisitions and corporate restructuring, project finance, and banking and corporate financing through capital markets. He has experience representing investment banks as well as companies that raise funds from international capital markets.

_____________________________________________

TTR – Firstly, Mr. Boisset, we would like you to share your opinion on the progress of the Peruvian market in 2019. 

R. B. – Both the number and value of deals reported proved to be a quiet active year in terms of M&A transactions, which turns to be interesting considering the slowdown of the Peruvian economy and the political crisis we faced during the year and particularly in the last quarter. Once again the energy sector has been the most relevant in terms of size and complexity but we also saw relevant deals in the manufacturing industry, such as the Intradevco Industrial sell to Alicorp.

TTR – As an advisor in M&A deals, what could you tell us about the investors that show interest in Peru-based companies? What are the main attractions of those companies? 

R. B. – I would say macroeconomic stability, low inflation, stable exchange rates, independency of the Central Bank, simplicity of its tax regime, and a deep potential growth of the middle class, which is an opportunity in several industries.

Despite the slowdown of the economy, Peru has proved to be a country, in which its macroeconomic fundamentals showed to be isolated from the political instability 

TTR – In 2019, there was an interesting increase in agribusiness deals in the country. What can you tell us about that upsurge? 

R. B. – Unlike other countries in the region, Peru’s large coast has some strategic keys for the agribusiness, such as predictable weather, access to ports for exportation, water supply and reasonable land prices and workforce costs. We have seen a consolidation of land and production of local investors in the last 10 to 15 years, that are now being acquired by bigger players that need such scale to invest. 

TTR – What other sectors could potentially have a noteworthy increase in their activity in the mid-term? Why? 

R. B. – It will of course depend on how the economy will move in the mid-term, but we expect that sectors related to the increase of the middle class be more active, such as education, retail, healthcare, and real estate. 

Two other sectors that may be relevant are mining and infrastructure. In mining, the slowdown of commodity prices creates the need for some companies to divest and the opportunity to others to invest. In infrastructure, we expect the criminal trials to end in the midterm allowing new investors to acquire assets that the current conditions do not offer the transparency and security that are needed. 

TTR – Lastly, what is your forecast for the next year?

R. B. – We believe it will be a very active year, probably even more active than 2019. Key sectors will be education, healthcare and manufacturing.