Salini outlines plans for Impregilo

By Helen Wright24 April 2012

Privately-owned Italian contractor Salini has made further details clear about the strategic industrial plan it is pursuing with Italy's largest contractor, Impregilo - a company in which it has now built a stake of 25.4%.

Salini has so far spent around €200 million buying Impregilo shares on the open market, €123 million of which was spent during 2011.

Salini CEO Pietro Salini said his company intended to create a "national champion" with a strong financial profile that could compete globally. Mr Salini said the tie-up would represent "a unique chance to demonstrate that Italy can compete successfully".

The proposal that Salini is submitting to Impregilo's shareholders envisions a combined entity with total revenues of up to €7.5 billion by 2015, and an earnings before interest, tax, depreciation and amortisation (EBITDA) range of between €800 million and €1.05 billion.

A tie-up would also produce annual EBITDA synergies of €100 million, according to Salini.

Asset sales planned

Salini said it would focus on Impregilo's activities in the construction business, targeting large and complex projects worldwide. This strategy would also see the sale of non-core assets, and Salini identified Frisia and Frisia Babcock - Impregilo-owned engineering companies that make incinerators and desalinisation plants - as potential candidates for future sales.

At the time of writing, investment consortium IGLI owned 29.9% of Italian stock exchange-listed Impregilo, while McKinley Capital Management had a stake of 2.3%, Amber Capital held 5.1% and, aside from Salini's stake, the rest of the stock (37.3%) was free floating.

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