Sunday, February 5

The latest by Florentino Pérez underpins the expected growth of ACS


ACS ended 2021 with a golden icing in the form of the completion of the sale of its Industrial Services area to the french group Vinci for 4,902 million euros. The capital gains generated in the operation underpin a stock market growth for 2022 that analysts expect to be 30 percent.

The sale transaction initialed on the last day of 2021 has ended up being closed for an amount slightly lower than originally estimated, but it represents the largest corporate transaction that took place in Spain this year and leaves a net capital gain in the accounts of ACS which rises to 2,900 million euros.

The construction company faces 2022, therefore, with a liquidity that convinces the market, despite the fact that greater clarity is still awaited on where the company will reinvest this generous economic injection.

The details of the ACS operation of the year

The construction group led by Florentino Pérez announced last March the sale of its industrial division to Vinci, at which time it was specified that the Spanish construction company received a minimum payment of 4,930 million and a maximum of 4,980 million, once the transaction received the approval of the regulatory authorities.

This amount has been reduced at the time of the final signing of the agreement by 4,902 million euros, announced by ACS on December 31 in a release referred to the National Securities Market Commission (CNMV).

The construction company has also confirmed in that announcement, however, that it will receive a maximum variable payment of 600 million euros in cash, “at a rate of 20 million euros for each GW medium developed by the Industrial Division between March 31, 2021 and up to 7 years following the execution of the sale “.

This payment will also be extendable for an additional 18 months “if the Industrial Division sold fails to develop 6 GW in the first 42 months.”

Similarly, both parties have agreed to create a joint venture of which ACS it will have 49 percent and to which both companies will contribute, for at least eight and a half years, all the renewable assets developed by the recently sold Industrial Division.

ACS maintains its growth potential on the stock market

ACS has been one of the securities that have suffered the most on the stock market during 2021, closing the year with losses of 13.19 percent that have left their shares at a price of 23.57 euros, despite having closed a last month with 11.13 percent recovery.

Looking ahead to 2022, the consensus of analysts gives a target price to the share values ​​that stands at 30.75 euros, which would mean achieving a revaluation of 30.5 percent in 12 months.

The optimistic trend of analysts regarding the possibilities of ACS In the next trading year it shot up in November, after third-quarter results in which the 7,035 million euros of revenue achieved gave positive signs of a recovery in activity after the stoppages suffered during the pandemic.

Reports like the one made by Bankinter However, they again influenced the fact that one of the keys to future value is the potential investment of the proceeds obtained from the sale of the industrial services business to Vinci.

But despite this notice, the financial institution’s purchase recommendation moves in an environment similar to that of the consensus, since it gives a target price of 30.5 euros for the shares.

An increase in the dividend is expected within the sector

Despite the lack of evidence offered by ACS sAs to how it will reinvest this capital gain, Bloomberg Intelligence indicates that the leaders in the construction of infrastructures, among which the Spanish group is included, “are prepared to maintain spending at current levels, increase dividends and resume the repurchase of shares in 2022 “.

“2022 ebitda and free cash flow stress tests with declines of 10-20 percent versus consensus show that construction companies have sufficient capacity to withstand dividend increases and asset purchases,” the report explains.

With that data in hand, Bloomberg Intelligence analysts forecast 2022 to see a likely average dividend increase of 20 percent compared to 2021.

In the case of ACS, the report notes that the corporate restructuring following the planned divestment of its energy business “could cause investments to drop 22 percent in 2022, while Vinci could increase 9 percent.”



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