Europe’s building firms caught amid rising debt
LONDON: It was good while it lasted for Europe’s construction companies. The state kept them in work with a steady supply of contracts, local banks provided the financing and profits rose.
Then came the financial crisis and the longest recession of the postwar era leaving states unable to spend and banks unwilling to lend. Much of the once-thriving industry has been pushed to the brink.
Here is a list of some of the companies under pressure:
Abengoa (Spain)
The Seville, Spain-based construction and engineering company, specialising in renewable energy plants, is being overhauled less than two years after a nie-billion euro (US$10bil) debt restructuring. The company is seeking support from creditors to restructure a rump of its old debt and to get 297 million euros of new funding.
Aldesa (Spain)
The Madrid-based builder shelved a 300 million-euro bond issue in May with management blaming fickle markets amid mounting investor concern for the health of the building sector.
Carillion (UK)
The British firm, with contracts to run everything from hospitals to rail projects, filed for liquidation in January after failing to secure a government bailout. Its demise wiped out bank lenders and bondholders to the tune of £1.6bil (US$2.1bil), casting a shadow over the future of dozens of sub-contractors, suppliers and competitors.
Isolux Corsan (Spain)
The Spanish construction group restructured its 1.6 billion-euro debt pile in 2016, two years after a debut bond issue issue and a failed attempt to take the company public. The overhaul wasn’t enough to keep Isolux afloat, however. The company filed for bankruptcy in July 2017.
OHL (Spain)
Founded by former Spanish business minister Juan Miguel Villar Mir, OHL sold its concession-unit last year, giving some respite to shareholders and creditors. It didn’t last long. — Bloomberg