Asesoramiento financiero
Cernaval Group
Case Study
Mirabaud Advisors closes financing of Cernaval Group’s new shipyard concession in Algeciras
Mirabaud acted as financial advisor to Cernaval, a Spanish shipyards company, in the structuring and raising of a hybrid financing (Project Finance + Corporate Debt) to invest in the extension of its concession in Algeciras.
About Cernaval Group
Cernaval Group is one of the main Spanish and European shipyards specialising in repairing and maintenance of mid and large scale ships with more than 30 years of experience.
The group operates through two concessions, located in the ports of Algeciras (World Top 20 and European Top 5 by traffic volume) and Málaga.
Transaction overview
In 2018, Cernaval was granted a new concession for 30 years by the Algeciras Port Authority located next to its current concession.
The new concession would allow the group to install a floating dock while leaving space to carry out afloat repairing to additional ships at 4 berths (1km of quays) (current concession structure 1 dry dock + 1 berth). This would allow them to increase the carrying capacity and provide services to larger boats, conducting dry reparations, afloat or a combination of both.
This would be a transformational project for Cernaval, positioning the Company as the reference repairing and maintenance centre in the Asia-Europe route that goes through the Strait of Gibraltar.
The plan was to raise the required financing in just a three month period for a total amount of €31m to, jointly with the current shareholders equity contribution, conduct:
- the acquisition, transportation and installation of the floating dock and;
- the beginning of operations of the new concession
Mirabaud contacted more than 20 potential reference investors (both national and international) including banks, as well as direct lending investors.
The transaction was structured as a long term Project Finance + Corporate Debt as it is a concessional asset affected by demand risk, complying with three targets:
- Obtention of the required financing to accomplish the committed investment
- Matching the funds disposals to the investment needs (structuring three tranches) and the repayments to a conservative cash generation scenario, including a target balance mechanism in case of cash generation surplus after debt repayment
- Achievement of optimal cost conditions
We are extremely proud of having supported our client in acquiring the financing required to support the Company’s expansion. We were able to structure and conduct a competitive process between specialised debt funds and financial entities, achieving a financing agreement under very attractive conditions for our client.
Mirabaud contribution and added value
Design of the transaction structure (hybrid between Project Finance and Corporate Debt) allowing Cernaval to raise financing over 5.0x 2018 EBITDA at a very competitive cost.
Comprehensive advisory during all the process being able to design and execute the financing on a successful manner in just three months period.
Contact and negotiation with each of the identified potential investors, creating a competitive process that maximized the financing conditions (in both terms of costs and guarantees).
Assistance in the selection of the most adequate proposal that fitted best with the future cash generation and the investment calendar and requirements.
Advisory and coordination of the closing between Cernaval and the selected financing entity, including the advisors due diligence and the financing and guarantees contracts.
Key data
| Company | Cernaval (shipyard specialised in the repairing and maintenance of ships) |
| Transaction type | Project Finance + Corporate Debt |
| Financing | € 31,000,000 ( >5.0x NFD/2018 EBITDA) |
| Term | 7 years (target balance) / 14 years (contractual life) |
| Amortisation | Increasing semi-annual repayments in the initial years with a balloon (c.40%) |
| Mirabaud Role | Structurer and Financial Advisor |
Case Study