EPM To Sell Mexican TICSA Subsidiary

EPM Capital México S.A. de C.V. and EPM Latam S.A., both subsidiaries of Grupo EPM (a state-owned company by the Municipality of Medellín, not publicly traded), have agreed to sell 100% of the shares of Tecnología Intercontinental, S.A.P.I. de C.V. (TICSA), a Mexican company specializing in the design, construction, operation, and maintenance of water treatment systems. The buyer is Colombian infrastructure company Odinsa S.A.

The enterprise value of the transaction is up to $2.905 billion MXN, equivalent to approximately $609 billion COP based on the current exchange rate. The equity value of the transaction is up to $1.598 billion MXN, representing approximately $335 billion COP.

The agreement has been signed, but the transaction’s completion is contingent on a series of closing conditions, including the approval of the Mexican competition authority, the Comisión Federal de Competencia Económica (COFECE). The fulfillment of these conditions requires the joint effort of buyers, sellers, and other involved third parties, introducing an element of uncertainty regarding the final closing.

Since 2021, Grupo EPM has been evaluating options to improve TICSA’s performance and optimize its corporate portfolio. In line with this strategy, a decision was made in late 2023 to pursue a total divestment through an open and competitive sale process. The process invited 33 potential strategic investors and investment funds from various countries, including Canada, Spain, France, the United States, Japan, and Mexico. Odinsa ultimately submitted the most favorable offer and was selected for the final phase, culminating in the signing of the share purchase agreement.

“At Grupo EPM, we are adjusting our investment portfolio to focus our human and financial resources on markets and projects where we have greater opportunities for growth, value creation, and sustainability,” stated John Maya Salazar, general manager of EPM and leader of the EPM Group. “TICSA is a company with proven technical capabilities and a distinguished track record in the water sector. In the hands of a manager like Odinsa, with a strong investment capacity and proven experience in structuring, operating, and maintaining infrastructure assets, its development and expansion can be enhanced.”

In 2013, TICSA became part of Grupo EPM after a capital investment gave the company a majority stake, making it the first international water sector company in the corporate group. Subsequently, Grupo EPM acquired 100% of its shares in 2019. To date, TICSA has constructed and operated more than 160 water treatment plants, consolidating its technical leadership in Mexico and other markets.

Tecnología Intercontinental, S.A.P.I. de C.V. (TICSA). Photo credit: Ticsa Grupo EPM/Facebook.