Mexican construction companies such as Tradeco, ICA, GIA, IDEAL, and Marhnos have expanded into other Latin American countries due to the lack of opportunities for further growth in Mexico and the ease of doing business in the region, which does not require a high level of leverage.<\/p>\n
Faced with a lack of opportunities to continue growing and securing contracts in Mexico, Mexican construction companies have strengthened their presence abroad, either by participating in bids in various Latin American countries or by acquiring companies in the sector. <\/p>\n
To date, Tradeco and ICA are the companies with the strongest international presence, specifically in Latin America and the United States; meanwhile, GIA operates in Chile, IDEAL in Panama, and Marhnos in Guatemala.<\/p>\n
In 2014, ICA, Tradeco, and GIA signed agreements totaling at least $812 million for three projects and the acquisition of a company outside Mexico.<\/p>\n
Experts agreed that the participation of Mexican companies in Latin America has increased because the region offers construction models that do not require heavy leverage, which makes it easier for domestic firms to enter the market.<\/p>\n
Marco Medina, an analyst at Ve por M\u00e1s, explained that the advantage Mexican firms have abroad is that they seek to participate in public works projects, which are usually financed by local governments, so they do not have to disburse funds and can thus continue to win projects, while improving their leverage ratio.<\/p>\n
Although Mexican companies\u2019 expansion into foreign markets is not a new phenomenon, the revenue they generate has increased significantly: In the case of ICA, sales from abroad rose from 7 percent of its total revenue in the first nine months of 2009 to 32 percent in the same period of 2014. Meanwhile, IDEAL\u2014which had no foreign revenue in 2009\u2014now sees foreign revenue account for 9 percent of its consolidated sales.<\/p>\n
Alonso Quintana, CEO of ICA, noted that the company's three-year goal is for 40 percent of its revenue to come from abroad.<\/p>\n
Tradeco has participated in at least 10 projects in other countries, and in 2013 alone, it won contracts worth approximately $600 million in the United States and Colombia.<\/p>\n
\u00abLatin America is an excellent market where we can certainly export construction and specialized engineering services such as tunneling, foundation work, and water treatment; I see it as a very attractive market,\u00bb said Luis Z\u00e1rate, president of the Mexican Chamber of the Construction Industry.<\/p>\n
Another example is GIA, which last year was awarded a 15-year concession for the Salvador Hospital and the National Institute of Geriatrics in Santiago, Chile, with an investment of $308 million.<\/p>\n
IDEAL holds the concession for the Bajo Mina and Bait\u00fan hydroelectric plants in Panama; and since 1997, Marnhos has operated the Pal\u00edn-Escuintla highway in Guatemala.<\/p>\n