Foreign Investment in Spain: Vulture Funds, Venture Capitals, and Billionaires Enjoying Cheap Prices


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What means to buy 6% of a Spanish construction company for Bill Gates? Sure not too much. However, for Spain it is very relevant that one of the biggest fortunes in the world has paid attention to one of its brands. Money from international investors has been coming to the country all the year long from different sources to different destinations. Money flows from vulture funds, venture capital firms, billionaire families, pension plans or even sovereign funds to public debt, stock exchanges or companies acquisition.

Javier Flores, analyst at the European Society of Professional Investors, (Asinver by its initials in Spanish) comments that “Spanish companies have never been especially prone to let foreign investors and partners to enter their capital, but now they are able to make a virtue of need, and overcome that traditional opposition”.

Reviewing the international investment operations on Spain assets during last year,  it is worthwhile to mention the ones carried out by the Mexican magnate Carlos Slim, who acquired 439 offices of Caixabank at a price of 428,2 M€, and later on bought a 0,5% stake of Gas Natural. On the other hand, and also within the energy sector, the investment fund from Singapore, Temasek, took control of 5,05% in Repsol, one of the Spanish blue chips, at an amount of 1,030 Bn€.

The Spanish banking sector has also been very active because of their need to reinforce their balances, consequently selling assets that have generated important foreign investments. The most outstanding operations would be the acquisition of Banco Popular’s recoveries division by the German KG EOS Holding at 135 M€, or the buying of a 51% stake of Santander Seguros y Reaseguros by the Dutch AEGÓN at 220 M€.

According to Javier Flores, “it would be very good for the country that institutions and companies take actions and measures to enable financial investment arriving in Spain from everywhere, to flow under adequate conditions and incentives to become productive in the long term”. “Spain needs investors, not pelotazos [when a company has the hit]”, concludes the analyst, who uses that Spanish word to make a clear reference to the questionable highly speculative terms that ruled property deals in Spain during the last 20 years.

The Spanish association of venture capital companies (Ascri by its initials in Spanish), has also questioned the quality of foreign investments currently entering into Spain since they do not come from “core” funds but mainly from vulture ones. Indeed, at this moment, some “core” funds from Germany, Switzerland, Luxembourg and England are just looking for long term investments in Spain, but not negotiating. The sovereign funds that moves rich countries investments have not taken either any action on Spain in 2013, except for three small real state contracts signed by Qatar and Dubai.

About the Author

Julia Pastor
Julia Pastor has broad experience in business writing for Consejeros Media Group at Consejeros, Consenso del Mercado and The Corner. Previously, she worked for the financial news agency GBA and contributed to El País Business. She holds a Master's in Financial Journalism and a degree in English from the Complutense University in Madrid.

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