Almost on the eve of the home stretch of 2024, the IPO calendar in Spain is once again reactivated. The market now expects During the month of November the Cox bell rings. Based on the multiples of the company’s comparables, Its market valuation could exceed 1.1 billion euros. From this value, the IPO discount of between 10 and 15% should be subtracted.
In early October, the company (formerly Coxabengoa) publicly announced its intention to carry out a public offering (IPO) to begin trading on the Spanish stock market. With this, it would be the second company to access the continuous market so far this year, after the debut of Puig (the largest IPO in the world in 2024, with a market value of 13.9 billion euros) last May. Considering that December is a complex month to enter the stock market, The only window of opportunity to access the Spanish prosecutor’s office opens this month of November.
Cox plans to raise around 300 million through this operation which, initially, will aim at the growth of the company itself, with the aim of taking advantage of the opportunities that arise in its sector.
The activity of this company lies essentially in two segments: on the one hand, water and energy concessions (from which they derive most of their profits, 80% precisely) and, on the other hand, engineering, operation and maintenance of its plants (they are not immersed in the construction process). It would be the water sector that would present one of the greatest growth potentials for the company and, therefore, also the energy sector, since the two are linked, since power plants are needed to supply this electricity to water treatment plants.
Thus, the growth of the water activity can vary between 25% (lower part of the range) and 35% (10% of this growth would come from the desalination part and 10-15% from water treatment). The company’s earnings growth will depend on its ability to take advantage of growth opportunities, although it will still be in the double digits. In this sense, sources close to the operation emphasize that Cox’s gross operating profit (ebitda) this year would be 175 million euros (EBITDA in the first half was 23 million).
Given its activity, the main comparables with which Cox would begin to compete on the stock market would be Veolia and the Spanish Acciona. These three companies are leaders in their sector and, moreover, the only ones (along with another Egyptian company, although much smaller) to have certifications for water.
In this sense, the expert consensus collected by FactSet forecasts an ebitda of 6,725 and 2,058 million euros respectively for Veolia and Acciona. The debt of the French company reaches 18,471 million euros, which, with a capitalization of 21,600 million euros, leaves the company evolving with an ev/ebitda multiplier of 6 times. For its part, Acciona (which would close 2024 with a debt of just over 7.730 million euros according to estimates) presents a multiple of 7 times. So, taking the average of the two multipliers (since it is assumed that Cox will grow more than both companies, which is why the average multiple is taken for the calculation) and the projected ebitda for Cox in 2024, The Spanish company could make its IPO with a valuation of 1,130 million euros. At this price, no debt should be subtracted since Cox is do the housework.
To the possible 1,130 million euros that the company may be worth on the stock market, it is appropriate to apply the discount required by institutional investors when they go to the primary market during an IPO and which is generally located between 10% and 15%, depending on each person. case. . Applying it, Cox’s valuation could be between 1,017 and 960 million euros.
In your case, moreover, its profit growth would become higher than what the experts themselves expect from these competitors. By 2025, analysts predict an increase in Veolia’s Ebitda of 6% and 15% for the Ibex 35 company.
For the moment, Cox comparables live one of lime and the other of sand in a bag. While the behavior of Veolia on the stock market records a slight revaluation of 2%, Acciona shares lose more than 10% over the year (during the year losses increased by more than 20%) and it establishes itself among one of the most bearish companies of the Ibex 35. In addition, it should be noted that the performance of energies Spanish renewables on the national market is uneven. Within the Ibex 35, Acciona’s green subsidiary, Acciona Energía, suffers even greater declines in 2024 than its parent company, by 32%, and the price of Solaria falls by up to 46%, which makes it the most bearish company on the index this year. On the Continuous Market, Audax Renovables, Grenergy and Ecoener however recorded annual increases of 38%, 265 and 2% respectively. In the midst of the crisis, Soltec’s listing has been suspended since the end of September, but the company lost more than 50% of its value over the year.
More information about the operation
The company founded by Enrique Riquelme will not carry out a capital increase, the operation It will be carried out simply through the IPO with which the positions of the main shareholders will be diluted. Cox’s executive chairman, through Inversiones Riquelme Vives, is the largest shareholder with 78%. Alberto Zardoya, with 17.5%, and the National Brotherhood of Architects (HNA), with 4.5%, complete the capital. With an OPS of 30% – the legal minimum is 25% – Riquelme would retain the majority of the capital. The offering will be directed to qualified investors and will include a placement in the United States aimed at qualified institutional investors.
The operation is not yet carried out by any investment bank. And, once it goes public, the company will decide whether Cox continues to be listed on the Mexican market.
