This operation consolidates the construction company as one of the top ten most important companies in the business in Spain.
The two companies are completely complementary and allow Sando to duplicate its main assets in the real estate business.
Additionally the Sando Group will considerably increase its presence in the real estate business in Madrid, will be present in Catalonia, at the same time as reinforcing its presence in Poland.
The Sando Group has agreed to the acquisition of 100% of the share capital of the Agofer real estate company for 220 million Euros. In this way, Sando continues its consolidation process as one of the top ten most important companies in the business in Spain. Additionally, Sando has become a company of reference in the building business in Spain.
Sando, one of the leading companies in the building business in Spain, had a turnover of 759.5 million Euros in 2006, which was an increase of 46% over and above the 519.6 millions of the previous year. In this way, Sando has become consolidated as one of the top ten most important companies in the business in Spain ranked by turnover.
The main activity of the Sando real estate division is centred on building developments (housing, tertiary and industrial developments), land management and asset exploitation. Sando is present in the Madrid, Barcelona, Andalusia, East Coast , Murcia and Polish markets. The Real Estate Division manages almost 8 million square metres of land, with a building area of 2.9 million square metres for developing more than 20,000 homes.
Agofer, on the other hand, is a Madrid family group established in 1982 which manages, develops and builds homes, although over the past few years has diversified into other products such as senior citizens residences. With Sales Offices in Madrid, Barcelona and Poland, the company is in full national and international expansion. Its operating revenue in 2006 reached 169 million Euros, with a pre tax profit of 46 million Euros.
By means of this acquisition, Sando has doubled its main business assets in the real estate business: tangible assets, stocks, etc. By geographical areas, Sando has notably increased its activities in Madrid, has obtained presence in Catalonia and Alicante, and has reinforced its position in Valencia and Poland.
Subsequent to the acquisition, Sando will develop more than 3 million square metres of building land, by means of mainly first home building developments of 22,300 homes: 14,900 in Andalusia, 1,600 on the East Coast, 2,500 in Madrid and surroundings, 900 in Catalonia and 2,400 in Warsaw. Also current building developments will be increased up to 3,100 homes, of which 1,353 will be handed over in 2007.
THE Sando Group pre tax profit was 162.5 million Euros, 246% more than in 2005, of which 88.3 million were extraordinary profit. Without taking into account the extraordinary income, the operating income reached 74.2 million Euros, 58.2% more than in the previous year. This evolution has been based on the increase in building activities, and on the diversification strategy, above all in the areas of real estate, Concessions and the environment, not forgetting the excellent results of the rest of the activities.
STRATEGIC ACQUISITION
This corporative acquisition is strategic for Sando, since its real estate business has been considerably reinforced, and has become consolidated as one of the largest leading development groups.
With new development plans for all its international and East European operations, Sando anticipates consolidation as a company of reference in the real estate business, and obtaining increased growth. In fact the 2007 forecast for the total sales of the real estate division is for more than 350 million Euros.
The synergy existing between the Sando and Agofer operations are outstanding, since the acquisition of the latter, with its flexible and expert staff structure, reinforces and complements the consolidation and expansion plans in Spain and Europe.
The acquisition is pending the approval of the Competition Authorities (equivalent of the Monopolies Commission).
For this operation, Sando has had the benefit of having Price Waterhouse Coopers as financial advisers and Garrigues as legal advisers, whilst the Agofer legal advisers were Uría y Menéndez and Irea their real estate financial adviser. The operation will be financed by Banesto.
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