Spain, a highly attractive market for business investment in 2013

2012年9月28日

2013 will be an unbeatable year for investing in assets and companies in Spain
2013 will be an unbeatable year for investing in assets and companies in Spain

This is the conclusion drawn from the event “Recovery of financing: the key to growth” organized by Arcano and Cuatrecasas, Gonçalves Pereira in Barcelona; some of those attending the event were Román Escolano, president of the Instituto de Crédito Oficial (Official Credit Institution or “ICO”); Jaime Carvajal, managing director of Grupo Arcano; and Jorge Arqués, partner at Cuatrecasas, Gonçalves Pereira. 

 

According to Arcano’s experts, 2013 will be an unbeatable year for investing in assets and companies in Spain, with companies with exporting capacity being the most attractive, although finding mechanisms enabling institutional and non-banking private investors to reach them at a reasonable cost and risk will be a key factor. 

 

At the event, in addition to commenting on the growing role of the ICO in the financing of companies through finance institutions, new financing formulas were proposed as a way of cushioning the deleveraging process of the Spanish finance system, making it easier to create new instruments and markets, such as the new commercial paper market.   

 

For Cuatrecasas, Gonçalves Pereira, the finance market is undergoing an accelerated process of transition that will result in structural amendments such as the generating of new channels for alternative financing to provide companies with resources.

 

Arcano, an independent financial consultancy firm, and the law firm Cuatrecasas, Gonçalves Pereira held a joint event on alternative financing as a new source for attracting investment on the Spanish market. The experts of both groups raised for discussion the different challenges the Spanish market faces to access financing. Along these lines, Arcano classified 2013 as “unbeatable” for investing in Spain, given the low labor costs, the increase in productivity and the proven competitive capacity of Spanish companies with exporting capacity. They also discussed non-banking finance products that are necessary in view of the deleveraging procedure of the Spanish finance system. Cuatrecasas, Gonçalves Pereira has drawn up short-term structural reforms encouraging access to financing, indicating the various types of investors approaching Spanish companies with innovative financing solutions.

 

The speakers reviewed the recent years characterized by the slump in access to credit of medium-sized Spanish companies, which, in part was due to the new distribution of the financial entity map and recapitalization processes, as to date the banking and savings bank system has supplied more than 80% of the financing to companies while other actors, such as capital markets, supplied less than 20%, inverse figures to those found on the North American market. Therefore, new financing mechanisms and actors should be sought. On the one hand, the increased role of the ICO as a counter-cycle financier of companies (through finance institutions) was emphasized, at present financing more than 10% of the new credit to companies. On the other hand, new formulas are being developed that disintermediate the banking system and enable business financing to be re-launched, such as the new commercial paper market (Alternative Bond Market) or specialized investment funds, both national and foreign.

 

Attending Recovery of financing: the key to growth were the president of the ICO, Román Escolano; the managing director of Grupo Arcano, Jaime Carvajal; Iñigo Susaeta and Ignacio de la Torre, partners at Arcano; and Jorge Arqués and Héctor Bros, partners at Cuatrecasas, Gonçalves Pereira, as well as experts from the two groups who put forward their arguments before a forum of 80 guests at the Hotel Majestic in Barcelona.

 

During the event, Iñigo Susaeta, partner at Arcano, spoke of the potential leading role of Catalan companies within the context of opportunities on the Spanish market. She recalled the trust the firm placed in Catalonia, where, in the last year, it has become a reference point for financial advice and asset management.

 

According to Jaime Carvajal, managing director of Grupo Arcano “in the current scenario, we believe that the Catalan industrial sector, one of the traditional driving forces behind Spanish export trade, the rise in tourism, and the consolidation of a true cluster of technology-based companies offer significant growth potential for Arcano in Catalonia.”

 

Héctor Bros, a partner in Cuatrecasas, Gonçalves Pereira’s Corporate and Commercial Practice, stated that the financial market is changing quickly and, although current difficulties have been generalized, “we are progressing towards a heterogeneous market from the perspective of the suppliers and, in the coming years, we will see investment funds taking on increasing importance and a significant expansion in corporate bond markets. Also, formulas for financing working capital will undergo innovation processes, in part thanks to the internationalization of the Spanish production sector.

 

 

Photo credit: kenteegardin / Foter.com / CC BY-SA

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