June 2016 Newsletter



Jueves, 16 Junio 2016 00:00


Miércoles, 15 Junio 2016 00:00


Trump, Le Pen...

Every economic crisis´s consequence is the appearance of demagogues, those who give understandable solutions easily to serious problems. In addition, the culprits are an easily identifiable group who are a minority. This is the political Adamism, to think that they are the first, that they are the revolutionists against the system and just by looking to history: Robespierre, Hitler ... The polarization that is currently living in the West materialized with Reagan and his frontal approach against socialism. Since then, the world has been radicalized. The good news is that in the USA, the foreseeable victory of Hillary Clinton can dulcify her message and return the third way that Tony Blair and Bill Clinton initiated at the time. And hopefully this time it is for good.

Miércoles, 15 Junio 2016 00:00


Shoot with the King´s gunpowder

This expression comes from the Flanders where every soldier received a package with their contemplated needs: A pike man less a harquebusier, to be funded out of their pocket, their armaments and equipment; the cavalry had to keep their mounts, etc. Thus, as the soldier gunpowder was paid from his own pocket, all the musketeers were careful not to shoot without an insured target. Except in cases of siege that came from the royal coffers. Why were the costs of each public service not disclosed and placed privately in competition for each citizen to choose, for example the school ?

Miércoles, 15 Junio 2016 00:00

The shades of the Spanish economy in graphs

The shades of the Spanish economy in graphs

The Bank of Spain has published recently its annual report depicting what we can call the 50 shades of the Spanish economy. Herein is a summary of some important data.

Starting with the evolution of the domestic demand which is clearly shown to be the engine driving GDP growth in 2014 and 2015, with an emphasize on the domestic consumption´s role. This rebound in consumption is tailored towards durable goods, for which the Spaniards have postponed purchasing during the financial crisis (such as changing TV, fridge…).

Graph 1: National demand and its components



However, this rebound in consumption is still higher than the growth in real wages, which could indicate that the actual growth in GDP is due to a momentary effort in household consumption. In the graph below, we can see the drop in wages that Spain suffered from since 2009 to see one of the consequences of the crisis. Today, the wages are far from what they were before the crisis keeping in mind that the inflation is negative.

Graph 2: Consumption and Real Wages

consumo y salario real 18


In terms of GDP, foreign demand has been falling in 2014 and 2015, while the last time we saw a fall in foreign demand was in 2007 which could be alarming. Spain seems to be performing better, but if the major economies are not doing well, this can have a contagious effect on Spain sooner or later.

Graph 3: GDP, national demand and foreign demand

pib demanda exterior3


Looking at gross wealth, today it is still far from 2008 levels. The main investment of Spaniards is real estate but it is still far from recovering from the golden years levels reached in full bubble.

Graph 4: Household Wealth

riqueza hogares


When it comes to debt, the national debt has already exceeded 100% of GDP and the EU average despite having been well below the level of debt of the Eurozone. Warnings were in place several years ago while some claimed that Spain was solvent due to its low level of debt.

Graph 5: Debt

deuda espan 8


Miércoles, 15 Junio 2016 00:00

CLOSA legal precedent in the Supreme Court

CLOSA legal precedent in the Supreme Court

After more than a decade of litigation, CLOSA has finally received from a former client the fees that they did not want to pay at the time. This incident is very important to the financial community in general as the heart of the advice is the confidence that we deposit in our clients, and as with the belief of some, that a covenant is always better than a lawsuit. Spain is a State of Law and cannot afford any type of similar performances. During the nearly 30 years of counseling and with more than 600 transactions completed successfully, it is the first time unfortunately that we had to go to this extreme.

Miércoles, 15 Junio 2016 00:00

Project with Grupo Godo

Project with Grupo Godo

Grupo Godo has reached an agreement with a selection of reputable companies to provide quality information to its audience. This new group called FORO EMPRESARIAL is composed of CLOSA (as financial advisor), AXIS CORPORATE (business consultancy), BBVA (for financing), ILV SILVER (integral support transactions), VIALEGIS (legal and tax advice) and WOLTERS KLUWER (information and software services). For example, and issued quarterly as a separate print of La Vanguardia´s Saturday´s issues, the first number dealt with company size (link) and the second one on the process of transformation (link)

Miércoles, 15 Junio 2016 00:00



The British citizens are to vote on June the 23rd over the faith of their relationship with the European Union. Although little research has been done over the consequences of this decision, some of the direct impacts of leaving would include deficit from trading with the EU where the country receives around £470Billion per year of foreign direct investment and 45% of its exports is directed towards the EU and 50% of its imports comes from it. Leaving the union would no doubt affect the trade with an extremely powerful trading partner. Furthermore, the country´s financial stability would be at stake and the country´s rating would be downgraded, as was confirmed by the rating agencies such as Moody´s. This would imply that foreign investors will shy away.

In the M&A market, the decision of the referendum is already weighing down. While the EU excluding the UK has seen a 48% increase in the Europeans deals announced during the first quarter of the year compared to last year, the UK had its worst quarter for deals since 2010 and the sterling has experienced the worst quarter against the Euro since 2008. Today, Chinese investors are   investing in Europe more than anywhere else in the world, drawn towards the energy, services and financial sectors, and the threat of the UK leaving has had significant negative impact on Chinese investment.


The UK was always considered as a safe route to the European marketplace and in case the exit occurs, it will no longer be a hub for investments unless very favorable trade agreements are arranged.

Miércoles, 15 Junio 2016 00:00

2016 first quarter M&A Statistics

2016 first quarter M&A Statistics

Worldwide M&A transactions totaled $699.4 billion in the first quarter of 2016, an 18% decrease compared to the same period last year, which also marked the slowest opening period since 2 years: only 22 deals with a greater value of $ 5 billion were announced with a combined value 24% less when compared to 2015 first quarter, and 9250 worldwide deals were announced, a 10% decrease from last year.

For United States targets, the activity totaled $245.7 billion during the first quarter of this year, a 38% decrease from the comparable period of 2015. On the other hand, European M&A activity registered $189.4 billion of announced deals, the strongest period in the region since 2011.

In terms of sectors:

Sector Compared to 2015 1rst quarter
Industrial Increase of 71%
Materials Increase of 41%
Financial Decrease of 2%
Healthcare Decrease of 53%
Technology Increase of 53%

For the first time, China is the top acquiring nation, with its record breaking level of outbound M&A activity where cross-border M&A deals totaled $304.6 billion during the first quarter of 2016, accounting for 44% of overall M&A volume, and an 8% increase since last year same period when they accounted for 33%. Of global M&A.

Miércoles, 15 Junio 2016 00:00

Takeaway and Delivery Acquisitions

Takeaway and Delivery Acquisitions

Just Eat Plc (LSE: JE.), the world´s leading digital marketplace for takeaway food delivery announced in February 2016 that it has agreed on acquiring four businesses from competitors Rocket Internet and Foodpanda for an aggregate of €125Million to be funded from existing cash resources.

Just Eat  Justeat
Based: London, UK

Market Capitalization: £ 2,5 million

Initial Investment funding of £10,5 million.

Listed on LSE in April 2014.

Markets: 15 countries in Europe and South America


rocket internet



Based: Berlin, Germany

A startup studio founded in 2007.

listed on frankfurt stock exchange in april 2012.

market: worldwide


Foodpanda  Foodpanda
Based: Berlin, Germany

Total funding: € 218 million

Mexico and Brazil business recently acquired by just eat.

Markets: 34 countries in Asia, Eastern Europe, the Middle East and Africa


The target businesses are online takeaway food companies residing in Spain (La Nevera Roja), Italy (PizzaBo/ hellofood Italy), Mexico (hellofood Mexico) and Brazil (hellofood Brazil). The new acquisition is regarded as highly complementary to Just Eat´s existing portfolio and thus is in line with its strategic growth plan to become the market leader in the geographical environment in which it operates. Studies have estimated that the takeaway food delivery in these targeted territories is worth over € 9.9 billion.

Previous operations in this market, such as the successful consolidation in 2014 of Just Eat in Brazil, demonstrates the effectiveness of M&A transactions in this sector. Through their joint venture with Movile and iFood, they became market leaders in Brazil and processed more than 1.1 million orders in December 2015, a 150% increase year-on-year according to company sources. The benefits include enlarged business volume and scale, with a bigger customer base that would enjoy a larger choice of restaurants, as well as economical synergies established with time that would in turn lead to increased sustainable margins. Just Eat expects the acquisition, in net terms, to adjust 2016 EPS and to add € 6.18 million to 2017 EBITDA.

The other side of the story shows that a trend of divestments has been taking place in the industry: Rocket Internet has sold quickly La Nevera Roja when it had acquired it only one year ago for € 80 million, Just Eat´s CEO David Buttress also sold 60% of his shares in March 2016, so as the finance director Mike Wroe who decreased his ownership by 55%. What seems to be behind the selling trend is mainly the business model of the companies: these start-ups, by providing the independent restaurants a web and online platform to manage their fleet of delivery people, are in fact being related in consumers ‘minds to the quality of food delivered which is mostly low-end fast food. As they don´t handle the food at any point, they charge a low fee of around 10-15% of the order price, and since they are limited in their food choice and price, they cannot optimize the speed and quality of delivery.



Best investment in start-ups since the dot-com boom

U.S. Venture Capital firms have raised $12.0Billion for 57 funds during the first quarter of 2016 translating into a 59% increase in dollar terms from last year´s first quarter and a 17% decrease in terms of the number of funds raised, according to the National Venture Capital Association (NVCA). This quarter investments has marked the best start to a year since the dot-com boom in 2001 and the strongest quarter since the 2nd quarter of 2006 when 79 funds raised $14.3Billion.


What is worth reflecting on is that the market considered 2015 to be the worst year for Tech IPOs since 2009: just 28 companies entered the U.S. public markets according to Dealogic compared to 62 in 2014 and 48 in 2013, 131 unicorns (companies valued at $1Billion or more by Venture Capitalists such as Uber, Xiaomi and Airbnb) opted to remain private for a longer period and half of the tech companies that went public have traded at below their IPO price.

Regardless, this data is surely good news for the Venture Capital industry that managed to gather the most money in a decade, money which will eventually need to get invested into American entrepreneurs businesses thus encouraging innovation.

Lyft, the American transportation network company that facilitates peer-to-peer ridesharing, completed a $1Billion financing round, seizing the largest deal of the quarter. Following, is the 3D computer-generated virtual reality start-up Magic Leap that raised $794Billion, and rounding the top 5 are Sunnova Enegry, Uber and Flatiron Health. The top 10 companies have raised 25% of total funds.

In terms of sectors, the most attractive was Software which gathered $5.1Billion, Biotechnology raised $1.8Billion whereas Media and Entertainment came in 3rd place with $930Million. More experienced start-ups were more successful in gaining more flows while early stage investments decreased by 18% in volume compared to the previous quarter.

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