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AICEP
Agência para o Investimento e Comércio Externo de Portugal

CABEÇALHO

China State Construction Engineering Corporation (CSCEC), a Chinese state-owned company that is the largest construction company in the world, is forming a consortium to submit an offer to buy 80 percent of Brisa.

The news is being advanced by Bloomberg, which realizes that CSCEC intends to enter the race to buy the largest Portuguese motorway company with at least two partners: CNIC and the Cooperation and Development Fund between China and Portuguese-speaking Countries.

 

CSCEC is owned by 100 percent by the Chinese state and, according to Business advanced in September last year, he was in Portugal for a week making contacts with potential business partners in the areas of construction and architecture. The targets would be the tenders for the port of Sines and the airport of Montijo, with Bloomberg now reporting that Brisa is also interested in the Chinese state company.

 

CNIC also already has connections to Portugal, a since he is a reference shareholder of EDP. This fund, also held by 100 percent by the Chinese state, currently has 1, 33 percent of the capital of the Portuguese electric company, but came to hold almost 5 percent of the capital. A position that, in addition to that held by China Three Gorges, allows Chinese state-owned companies to control more than 20 percent of EDP's capital.

 

As for the Cooperation Fund, it was set up in 2010 with an endowment of one billion dollars and aims to finance Chinese companies and Portuguese-speaking countries

 

According to Bloomberg, the consortium that will be formed to compete for the purchase of Brisa may also have more partners, and an adviser has been hired to advise on the offer that this Chinese consortium intends to place on the table.

 

The Chinese consortium is not alone in the race and, according to Bloomberg, the prospect of forming more consortia, led mainly by Spanish companies.

 

As previously reported, the Spanish company Global Via, the Japanese company Marubeni and the Spanish company Abertis are also expected to submit binding offers through Brisa. The latter, which is the largest Spanish motorway firm, could enter into a consortium with Singapore's sovereign wealth fund, the GIC. Bloomberg adds that Ardian and MacQuarie may join these consortia.

 

Arcus Infrastructure Partners and the José de Mello group intend to sell around 80 percent of Brisa, in a business that Bloomberg advances that can reach 3 billion euros and could be the biggest of the year in the infrastructure sector in Europe.

 

After phases of business presentation and expressions of interest on the part of several companies, now is the time to present formal and binding offers, which should happen over the next few weeks.

 

Last October, the José de Mello group and the Arcus fund announced that they had put up for sale, each, 40 percent of the voting rights in the breeze. With the completion of the sale, the fund will leave the capital, while the José de Mello group abdicates control of the concessionaire, but remains a reference shareholder with around 20 percent of voting rights.

 

The José de Mello group expects the operation to be completed by the end of the first half of 2020.

 

Brisa Concessão Rodoviária (BCR), which manages 11 motorways in Portugal, closed 2019 with profits of 204, 5 million euros, an increase of 22, 6 percent compared to the previous year.

 

The largest construction company in the world with an eye on Portugal

Chinese capital, especially state-owned, is present in several large companies and from the most varied sectors: energy through EDP and REN; banking through BCP; insurance through Fidelidade; and health through Luz Saúde.

 

The Chinese are also present in the infrastructures in Portugal and can now reinforce if the CSCEC consortium wins the race to Brisa.

 

In the ENR ranking of the 250 largest groups worldwide in the construction sector, China State Construction Engineering Corporation appears in first place. In 2018 it recorded revenues in the amount of 170 billion dollars (about 154 billion euros) and made a profit of 6.8 billion yuan, equivalent to more than 790 million euros.

 

China Construction Third Engineering Bureau Group, a CSCEC company that started investing in Portugal last year, is one of the arms of the Chinese group that also owns the company that in July agreed with Teixeira Duarte to buy 50 percent of TDE – Empreendimentos Imobiliários. In this case, CSCEC – China Construction Portugal (a company incorporated under Portuguese law established in January 2018) agreed to pay 31, 1 million euros in order to create a partnership for the development of a real estate project in Oeiras. The project in question will consist of office, housing and commercial buildings, integrated into a green park.

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