Webuild sale, analysts see the Strait Bridge as an important catalyst

(Il Sole 24 Ore Radiocor)- The Webuild is travelling at a good pace, benefiting from the final approval by the Cipess of the project for the Bridge over the Strait of Messina, along with a series of complementary works for the area. In terms of the stock market, the group's shares have been tradingsteadily at over four euros since 28 July following the publication of its half-year accounts, which exceeded analysts' expectations.

Returning to the infrastructure work, the approval by the Interministerial Committee for Economic Planning and Sustainable Development follows the signing of the additional deed to the contract between the concessionary company Stretto Di Messina and the Eurolink contractor (a consortium led by Webuild) for a value of EUR 10.6 billion. The project includes the construction of a bridge with an overall length of 3.666 metres with a central suspended span of 3.300 metres. Complementary works to the bridge include more than 40 km of roads and railways, three railway stations in Messina, a business centre in Calabria, and various land compensation works. The work is scheduled for completion in 2032-33.

Analysts at Intermonte point out that the €13.5 billion expenditure for the state will have to be approved by the Corte dei Conti within 60 days, after which "the contract will be included in Webuild's backlog (approximately 20% of the current backlog). The project has an attractive margin and cash flow/working capital profile with the first tranche of advances (estimated at EUR 600 million) received in the current year'. In the report, the brokers point out that the Minister of Infrastructure, Matteo Salvini, has stated that it will be up to the Minister of Defence and the Minister of the Treasury to decide whether the cost of the work will be part of the commitment made at Nato level "last June to increase defence spending to 5% of GDP of which 1.5% in infrastructure and dual-use projects".

According to Equita, the approval of the project 'represents an important catalyst for Webuild (we preliminarily estimate a value of the work of approximately 350/500 million for Webuild or 9%/12% of the current market cap) with the political support of the government now very high'. To date, the experts point out, the work is not included in the company's backlog and targets. "We continue to believe," they continue, "that the Bridge over the Strait of Messina is the pivot of the important investment plan envisaged by the Italian government in the development of mobility in the South of Italy, including the two railway lines Palermo-Catania-Messina and Salerno-Reggio Calabria."