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Arab company Alfanar buys Spanish smart grid provider ZIV


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Integral service around a transaction
BY : Diego GutiérrezApril Fri, 2017
Avantha group, which bought the Basque company in 2012, is selling the ZIV group in order to reduce debt, strengthen its balance sheet and build a financially stronger company.

About Ziv

Arab company Alfanar buys Spanish smart grid provider ZIV

ZIV is a firm dedicated to providing high-value automated smart grid solutions for industry and utilities, as well as supplying equipment for grid automation and advanced metering infrastructures. The company operates in more than 50 countries, including Brazil, the United States, India and Spain.

In 2007, Dinamia took a stake in Ziv, buying 74.5% for €23M. In 2009, this capital inflow allowed the company to invest in the internationalisation of the group, strengthening its presence in the United States, a market in which it was able to expand its production capacity thanks to its collaboration with Iberdrola.

In 2012 Dinamia sold Ziv to the Indian group Crompton Greaves, which is now called Avantha group. N+1 had invested €23.3m in the Basque firm and sold its stake for €81.4m, with a capital gain for its shareholders of €58.1m, achieving an IRR of 29%.

Ziv corporate finance analysis

In the last two years, Ziv's turnover has grown considerably, thanks to contracts with large companies such as Iberdrola, Enexis and Gas Natural Fenosa. Due to market growth worldwide, ZIV decided to expand and modernise its plant in Zamudio (Bizkaia). Its new automatic manufacturing lines allow it to exceed 2M smart meters per year in order to respond quickly to the market.

In 2015 Ziv achieved a turnover of €95M and an Ebitda of almost €6M. The company has a debt ratio of 9 in 2015. It is precisely this that leads Avantha Group to want to sell Ziv. Avantha Group aims to meet its debt reduction target, strengthen its balance sheet and build a financially stronger company. The company has been bought for a price of approximately €120M.

Sobre Alfanar

Headquartered in Riyadh, Saudi Arabia, Alfanar specialises in the electrical manufacturing business, including the manufacture of electrical construction products as well as related engineering services. The company's customers include construction and manufacturing companies, design and development centres with facilities in the Middle East, Asia and Europe. With more than 22,000 employees, it has a turnover of $2,500M.

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