Alvarez & Marsal advise Vicat on Brazilian cement plant purchase

10 October 2018 Consultancy.lat

Cement giant Vicat have extended their reach into Latin America for the first time with the purchase of a majority stake in Brazil’s Ciplan. The $333 million deal was finalised at the start of this week with Alvarez & Marsal acting as the buy-side advisors.

Established in 1853, The Vicat Group is a French origin cement firm with a global presence in Europe, North America, Central Asia, West Africa and the Middle East. The Vicat Group’s history however goes back beyond the Group’s inception to when engineer Louis Vicat was commissioned to build a bridge over troubled French waters and in turn invented artificial cement in 1817.

The discovery was considered too important to patent and Vicat made the findings of his work public. Louis Vicat’s son Joseph Vicat followed in the steps of his father and entered the cement industry with plans to build the world’s first industrial scale artificial cement plant in the French region of Isere's Genevrey-de-Vif. Today the firm owns multiple cement plants across 10 countries as well as aggregate quarries, concrete batching plants and also provides finishing product for the building industry.

The expansion into Brazil comes as the firm’s latest acquisition in emerging markets over the past two decades. The Vicat Group’s growth strategy has focused on both purchasing existing plants and cement companies in Turkey, India, Kazakhstan and Egypt but has yet to make moves in Latin America. The acquisition however of a 65% stake in Ciplan – located outside Brazilian capital Brasilia – marks the firm’s first steps out side the US in the region.

Alvarez & Marsal advise Vicat on Brazilian cement plant purchase

Ciplan is a market leader in Brazil with a presence covering the Midwest, North, Northeast and Southeast regions of the country. The company’s offerings include cement, aggregates, mortar and concrete which are used for civil construction purposes. Ciplan operates a modern plant, which produces roughly 3.2 million tons of cement per year. The company also has access to an abundance of minerals and boasts 9 ready-mixed concrete plants and 5 aggregates quarries.

M&A experts Alvarez & Marsal acted as the buy-side advisors for The Vicat Group alongside Pinheiro Neto Advogados as legal. The global professional services firm provided financial due diligence and tax due diligence services. Fabio G. Pires, the Managing Director of A&M commented on LinkedIn saying, “We congratulate The Vicat Group on their investment in Cimento Planalto or ‘Ciplan’ in Brazil.”

A&M in Brazil

Alvarez & Marsal specialise in business restructuring, financial due diligence and M&A tax and advisory services. The firm has a strong presence throughout the Americas with offices in the US, Canada, Cayman Islands and Mexico, as well as offices in both Rio de Janeiro and São Paulo. In a bid to bolster its cross border M&A capabilities, late last month A&M expanded its transaction offerings in Latin America.

As part of the expansion, Paulo Mota joins A&M as a Managing Director to its Global Transaction Advisory Group in Brazil. “As domestic and cross-border transactions rapidly increase in volume and value, the need for seasoned advisors is crucial. Paulo’s experience advising domestic and foreign clients in significant acquisitions and divestitures will bolster our team’s ability to meet client needs in Brazil and Latin America,” said Fabio Pires, Managing Director and Practice Leader of A&M’s Global Transaction Advisory Group in Latin America.

The firm’s focus on expansion in Brazil is part of of A&M’s global growth strategy which aligns with the demand for cross border advisory services. Demand for these services throughout the region also prompted other key senior appointments in Brazil with the firm bringing in Adriano José Ponciano and Emerson Santana in September. “Today, opportunities in Brazil exist alongside a unique business climate and a developing economy with highly variable financial controls,” said Pires.

Technical aviation consultancy Indaer sells MRO wing to airline

24 January 2019 Consultancy.lat

Indaer, a consultancy and services company for the aviation industry, has rebranded as ‘Indaer Aviation Technical Services’ following the sale of its MRO business in Colombia to a local unnamed airline. 

Founded in 2002, Indaer provides a range of technical consultancy services to airlines that operate commercial aircraft from Airbus, ATR, Boeing, Bombardier, Embraer and Pilatus. The company’s circa 100 engineers, technicians and systems analysts provide technical and advisory services in the areas of aircraft and engine asset management and regulations, aircraft records services, maintenance planning and oversight, in-service engineering, and field support & technical training. From its base in Medellín, Colombia, Indaer serves airlines, lessors and OEM suppliers across Latin America, and globally. 

In a press statement, Juan Osorio, CEO of Indaer, revealed that the company has divested its maintenance, repair & operations (MRO) arm to a “local airline”, without disclosing the specific airline. According to the latest data released by Colombia’s Civil Aviation Authority, there are currently 26 airlines that possess an Air Operator Certificate (providing them the right to exploit commercial aviation), including Avianca, the country’s largest carrier and second largest in Latin America, number two player VivaColombia, low-cost carrier EasyFly and government-owned Satena. 

“We are very happy to sell our MRO division to this airline and to see it become a model of efficiency and technical capabilities, while we focus on the consulting and engineering business with our new corporate structure at Indaer,” commented Osorio.

Technical aviation consultancy Indaer sells MRO wing to airline

Indaer’s MRO business specialises in maintenance services for airlines, lessors and OEM suppliers, as well as helping industry players meet regulatory requirements and obtain certifications such as FAA/EASA Part 145. The arm has a particular strong track record with ATR aircraft (a French - Italian aircraft manufacturer) – Indaer covers all of the ATR’s maintenance activities from A checks to 36.000 CY checks, and has hangar bays for the ATR 42 and ATR 72 models. The MRO wing is certified by four international CAAs: FAA, UAEAC (Colombia), DGAC (Ecuador), and 2-Reg (Channel Island).

The sale sees the Colombian company continue as a consulting and technical services firm, with the brand transitioning to ‘Indaer Aviation Technical Services’. Osorio: “We will continue to provide consulting, engineering and technical services to leasing companies and operators around the globe.” Agreed with the owner is that the brand ‘Indaer’ will remain the property of the company’s original founders. 

The move comes at a time when the MRO market for commercial aircraft is seeing solid growth. According to an analysis by Oliver Wyman, the number of commercial planes in the skies will increase by 4% annually up to 2028, when a total of more than 32,000 plans will be operational, with narrow-body jets set to record the fastest growth. As a result, MRO spending is projected to rise as well, to around $115 billion in 2028. Latin America’s MRO market is currently valued at roughly $4 billion – in the coming decade, the industry will grow to $6 billion. 

Related: Brazil is Latin America's growth driver for long haul flights by European airlines.