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Created in 1988 as a local subsidiary of the Spanish group Dragados, the construction company leaves its own brand and will operate under the name IEB Construcciones
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The history of Dycasa dates back to November 26, 1968, when it was founded as a local subsidiary of the Spanish group Dragados to participate in the local construction sector throughout the country and in some neighboring regions.
Since its inception, it has focused its activities on road works, port works, architecture, hospital complexes, educational complexes, underground works, commercial and industrial constructions, hydraulic and sanitation works, works for nuclear power plants and mining works.
At that time, Dragados decision responded to the need to grow abroad at a time when Argentina was seeing growth in investment in public infrastructure.
The creation of Dycasa allowed the parent company to leverage its experience and technical capabilities in a market with a growing demand for infrastructure projects.
Modernizing your information
On its website, the company explains that it "has the support and experience of Dragados SA, a leading construction company in Spain, and its holding company, the ACS Group, which allows it access to vast experience and technological research processes."
Surely, in the next few days the new owners of the construction company will have to reformat the page and update it since neither the European holding company is there any more nor will the company continue to operate as Dycasa.
As iProfesional reported last October, its controlling shareholder sold its holdings, representing 66% of the capital and 88% of the voting rights, to a recently formed company in Argentina. This is an unknown company that signed a share purchase agreement under the corporate name Inversora Mercedes and that belongs to Juan Ignacio Abuchdid; Ezequiel María Fernández and Martín Pablo Gándara.
According to the agreement, Dragados agrees to sell all of its shares in Dycasa to this unknown corporation in exchange for receiving only a payment of US$2 million. In this way, the Spanish group completes its exit from the Argentine construction sector just 10 months after the arrival of Javier Mileis government.
New direction
In this context, during an ordinary and extraordinary general meeting held on December 5, progress was made with the sale of the company and changes were approved for the future development and operations that the new owners will now undertake in the local market.
One of the points discussed was the mass resignation of the entire board of directors of Dycasa and its replacement by executives who will answer to the new owners of the construction company, such as its brand new president, Ezequiel Martín Fernández; Gastón Alemán, Vice President; Juan Ignacio Abuchdid, Gonzalo Venancio, María José Van Morlegan, Ricardo Zurlo as Regular Directors, among others.
Likewise, the process of reorganizing the Supervisory Commission and the modification of the corporate name and reform of the first article of the statute were approved.
In this case, the attendees at the meeting resolved unanimously by the votes present (81,603,254, to approve the change of corporate name from Dycasa Sociedad Anónima Construcciones to IEB Construcciones SA
Business in decline
The decision marks the end of a construction company that was a symbol of public works in recent years, as well as a strong protagonist of the periods of the so-called "Patria Contratista" until it began to lose business and suffer its cash flow and financial situation, to the point that its Spanish controlling group had to, on several occasions, send fresh funds to support its activities in Argentina.
But with the arrival of the libertarian government and the "closure" of public works decreed by President Javier Milei, the companys crisis deepened. In fact, it had to reorient its activities towards mining and industrial investments and public works financed by international organizations or with private financing. A change that was not enough to refloat its complicated situation, to the point that the new Argentine owners will dismiss 80 of the almost 300 Dycasa employees.
For the new owners, the assets of the construction company will allow them to position themselves in a sector with high potential and strategic value such as construction, particularly in large infrastructure projects.
All sectors that the former construction company Dragados has been venturing into throughout its history, such as when it was chosen during the government of Carlos Menem to build the prison in the Buenos Aires city of Marcos Paz, with costs that the current libertarian government criticizes because they believe they were "tripled."
Other projects
in which Dycasa participated during its years of operations were, together with the Cordoba group Roggio, the construction of the new sewage system in Mar del Plata, at a cost of $32 million, as well as the Atucha II Nuclear Power Plant; a Heavy Water Plant in Arroyito and a Paper Plant in Tucumán.
In the 1970s and 1980s, Dycasa established itself as one of the countrys leading construction companies, participating in important infrastructure projects such as the construction of bridges, sanitation networks, industrial facilities and residential complexes.
In addition, the company began to venture into hydraulic, electrical and gas works, as well as the construction of the urban highway system in Buenos Aires and its collaboration in the development of plants for different industries, including the petrochemical and food industries.
In the 1990s, characterized by a process of privatization of public companies and an opening to foreign capital, Dycasa participated in the modernization of the countrys infrastructure through concessions and public works projects. One of these projects was the expansion of the Ezeiza International Airport; the construction of hydroelectric plants and the improvement of electric power transmission facilities.
Significant turnover
With the turn of the century, the company diversified its services and focused on large-scale projects such as its participation in the construction of the Buenos Aires Metrobus or the construction of the Punta Negra hydroelectric plant in San Juan.
Until its sale last October, its core business was construction, provision of construction-related services, and participation in companies engaged in related activities. Its business volume to be executed in the next two years is $22,359 million, in viaducts, road and hydraulic works, and sanitation.
There were also significant private sector investments in mining, energy projects and industrial plants, in which the previous owners intended to actively participate by participating in said tenders "in order to maintain and increase their portfolio and their turnover."
Similarly, the company aspired to deepen its participation in private works in the mining industry infrastructure. However, the last few years have not been positive for the company to the point that in 2023 it operated with negative net worth, despite its executives trying various solutions to reverse the deficit, such as renegotiating with clients, filing complaints with the previous Government and other variants.
At that time, the solution came from Europe, more precisely from Spain, the country where Dragados SA is based, which, at the same time, was a creditor of Dycasa, for almost 7 million euros that it chose not to collect in order to "contribute to the functioning of the company", as explained in a note sent on Wednesday, June 21 of last year to the National Securities Commission (CNV).
The Spanish group also carried out an assessment of Dycasas situation and its financing needs and alternative possibilities of obtaining it, taking into account that it had been accumulating serious financial problems and multimillion-dollar losses that it has suffered for several years now, such as those of 2022 and 2021, which were $5,308 million and $384 million, respectively.
2023 was no exception and the construction company closed its balance sheet with a loss of $7,296 million and, again, negative net worth. Its sales also collapsed by 41% and reached $21,507 million, its gross margin rose to a negative value of $1,927 million, affected by the effect of inflation, due to the fact that the price redeterminations of the works do not recognize the real impact of the increase in costs. In addition, these redeterminations suffered significant delays in their approval and payment, also generating financial damage to the construction company.
Financial results amounted to a negative value of $4.445 billion, very similar to the previous year. However, the company had to face a higher financial cost as a result of greater credit needs, due to the delays that the different agencies have had in approving and paying price redetermination certificates, and on the other hand, they were also caused by the strong increase in interest rates, which far exceeded 100% nominal annual. |
