Mexican Company ICA Increases Presence in the United States with Acquisition of the Facchina Construction Group
- Jun 27, 2014
Mexico City—Empresas ICA, S.A.B. de C.V., the largest infrastructure and construction company in Mexico, announced the completion of the acquisition of the Facchina Construction Group (“FCG”) in the United States. The acquisition will enable ICA to increase participation in the U.S. market as part of its international growth strategy.
FCG has a strong presence in the Washington, D.C., metropolitan area and southern Florida, and was founded by Paul Facchina, Sr. in 1987. Landmark projects in the Washington, D.C., metropolitan area include the 11th Street Bridge reconstruction project, the Maryland Intercounty Connector highway project, and the U.S. Capitol Visitor Center. In Florida, landmark projects include the New World Symphony Campus Expansion, the American Airlines Arena, and residential high-rise developments such as the Grove at Grand Bay.
ICA launched an international diversification initiative in 2011, with the objective of increasing the international share of total construction revenues. ICA has already expanded its activities in key markets of Latin America, including Panama, Peru, Colombia, and Costa Rica. The acquisition of FCG now extends this initiative to the U.S. In the past, ICA participated in key U.S. infrastructure projects, but has not been active in recent years.
ICA has made an initial payment of $60 million for 100 percent of the ownership interests in FCG. Additional payments of up to $40 million could be paid based upon the company meeting agreed EBITDA targets over the next five years through 2019, among other conditions. As part of ICA, FCG is expected to be able to bid on and participate in larger projects than in the past, and be able to incorporate technologies that will improve efficiency. It will also have access to additional surety and financing capabilities.
In 2013 FCG had revenues of approximately $230 million, EBITDA of approximately $8 million, and net income of approximately $7 million. As of Dec. 31, 2013, FCG had net cash of approximately $30 million. Construction backlog totaled approximately $291 million at year-end. We are currently in the period of post-closing review.
The transaction has received all necessary U.S. regulatory approvals.