The Spanish Stock Market lacks large technology and research companies, those that have led the stock market rally that has led European and US indices to break highs time and time again. But there are certain companies in Spain with a clearly winning profile in the eyes of investors, even if they are not listed on the Ibex or intend to go public. This is the case of the Catalan company Werfen, which has just made its debut on the capital market and that, in view of the appetite observed for its bonds and its financial ratios, it could reach a stock market valuation of up to 6,000 million euros, according to market sources.
This firm specialized in clinical diagnostics has stealthily become a medical research multinational. And it has not lost its eminent profile as a family business along the way: its capital is shared equally among the four sons of the founder, José María Rubiralta.
As of June, it obtained revenues of 910 million, 20% more, and ebitda of 303 million
Werfen has a presence in more than 30 countries and last year reached a turnover of 1,696 million euros, with a growth of 15%, and a profit of 261 million euros, 45% more than in the previous year. Founded in 1966, it was not until this month of October that it had its first contact with the capital market, with an inaugural issue of bonds for 300 million euros with a term of five years.
The placement registered a demand that exceeded the offer by almost six times, proof of the high interest of investors in a leading company and with enviable financial ratios.
“If they wanted, they would have the size to be listed on the Ibex,” investment banking sources say. In the prospectus of the issue registered in Dublin, where the bonds are listed, Werfen advances its results for the first half of the year: an EBITDA of 303 million euros as of June, which grows 57% year-on-year, and a profit that more than doubles in the last year, up to 198 million euros.
Its capital is distributed equally among the four children of the founder José María Rubiralta
Its bottom line has been undeniably boosted by the pandemic, with activities such as PCR tests. But Werfen’s business already had its focus on strategic areas in the day-to-day hospital, such as coagulation, autoimmunity and acute care diagnostics or intensive care.
According to the company, more than 1.8 million samples daily are analyzed with Werfen reagents and systems in laboratories around the world.
Debt at a minimum
As of June this year, and prior to the issuance, its debt-to-ebitda ratio was only 0.5 times, compared to 1.5 times in June of last year. In July of this year, it carried out a syndicated refinancing of 250 million euros which, added to the placement of 300 million in bonds, has allowed the company to refinance all its long-term debt. Thus, the funds obtained from last month’s placement have been used to repay bank debt maturities in 2022 and 2023 in advance.
With this cover letter, financial sources indicate that Werfen would be a clear candidate for listing on the Stock Exchange, with a red carpet on the Ibex. Its levels of indebtedness and profits would allow a valuation of between 5,000 to 6,000 million euros. In line with the current market capitalization of Fluidra or Mapfre, in the upper band of that range, or Enagás, in the lower part. The company does not, however, have any intention of going public or seeking any partner for its capital.
Its current financial position also allows it to address possible purchase opportunities starting from a very low level of indebtedness. In fact, it has a team specialized in searching for companies that allow it to strengthen its size and complete its technology. In 2016, Werfen acquired the German company TEM for 125 million euros and the following year it acquired the American company Accriva Diagnostics for 380 million dollars.
Despite intense growth and business volumes, the company has maintained a low profile for decades that it aspires to maintain. Although, now you will have more obligations.
More transparency
After the bond issue, you will have to report your results on a quarterly basis, instead of annually as up to now. “They have a strong corporate culture and a very professional executive,” say sources close to the company. The president is, since 2019, Marc Rubiralta and the CEO, Carlos Pascual, with a professional career of 33 years in the company. The lawyer Miquel Roca Junyent is the secretary of the board of directors.
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