Sacyr has just announced the sale of 100% of its environmental services business (Valoriza Servicios), for an enterprise value of €734 million, to a company owned by funds managed by Morgan Stanley Infrastructute Partners. The value of the equity is estimated by Sacyr at €425 million, and the transaction is expected to close in 4Q of this year. The capital gains generated are estimated at €270 million. The company states in the press release that the funds from the sale will be used both to strengthen the concession business and to reduce corporate debt.
Intermoney’s assessment: This is an expected move, as Sacyr had announced the start of the sale process months ago. We confirm Buy, as well as our Buy and our Buy PO on Sacyr of €4.0. We think this is a good deal for Sacyr, as the price paid implies 9x 2022 EBITDA, when we value the whole services business at 7.5x. Environment generated EBITDA in 2022 of around €80m, while there is another services business, called Multiservices (€30m EBITDA), which includes facility management, road maintenance and other activities.
Applying the EV/EBITDA ratio of this transaction to the services business as a whole, Sacyr’s OP would increase by €0.3/share. Following this sale, Sacyr has decisively reduced its corporate debt, which at December 22nd amounted to €546 million. The sale of the water cycle concessions, which we estimate could be valued at around €350-400 million, is still pending.
