The priorities of the new Indra: entering ITP and reorganizing the Defense area

The pieces are being placed in Indra.

Oliver Thansan
Oliver Thansan
26 May 2023 Friday 22:27
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The priorities of the new Indra: entering ITP and reorganizing the Defense area

The pieces are being placed in Indra. The political-business operation to convert the company chaired by Marc Murtra into the Spanish Defense giant is taking shape through different movements that have taken place in recent days. The priority of the board of directors and the management team of the listed company is, at this time, double, according to different internal sources. On the one hand, to reorganize the military area, a division that wants to be relaunched. And, on the other hand, close the entry into the shareholding of ITP Aero.

Indra is lining up to execute, after years of waiting, the purchase of a significant part of ITP Aero. The percentage, according to market sources, could be around 15%, which would require disbursing around 250 million euros. The negotiation and the progress made so far with Bain Capital, its owner, are confidential, but the operation has the impetus of a renewed governing body and the executive leadership of the company, with the landing of the new CEO, José Vicente of the Mozos The Basque engine manufacturer was always interested in the Alcobendas headquarters, Indra's headquarters, but until now the operation had cooled down, during the Ignacio Mataix stage.

De los Mozos also has the internal mandate to value Indra's military business. It is the absolute internal priority, they emphasize from the company, the moment to take the giant leap to try to be the industrial firm of reference in arms matters in Spain, as are Thales in France or Leonardo in Italy. This does not mean that until now this division was neglected, but there were internal reluctances that are now being sought to be resolved in the early stages of the Murtra-De los Mozos tandem.

Betting on the military area is a demand that the sector, “our clients”, indicated an internal source, for a long time. Betting on this division also means placing the project for the future European combat aircraft, the FCAS, in a prominent place. It is a sixth generation fighter whose entry into operations is scheduled for the year 2040. It is already beginning to be configured jointly between Spain, Germany and France. For Indra, this is a historic opportunity, since it is the first time that the Spanish military industry has participated as a tripartite partner in a major community program.

The new Indra (its president Murtra mentioned at the last Feindef military fair that it was necessary to take advantage of the industrial and geopolitical moment) is being built with the arrival of De los Mozos and with a recomposition of the board of directors. The company is managing to articulate a shareholding group focused on promoting this new stage. In the first place, through the State Company of Industrial Participations (SEPI), dependent on the Ministry of Finance. The Government is clear that Indra's horizon is to be the reference military industry in Spain. And, secondly, through a group of shareholders committed to the project.

Among them, three stand out: Amber Capital, SAPA and Escribano. The British investment fund, founded by Joseph Oughourlian, had been interested in Indra for some time. This week, taking advantage of the resignation of independent member Alex Arendt, he decided to double his stake to 7.24%, requesting a position on the council. The chosen one is Pablo Jiménez de Parga, a lawyer with extensive experience and secretary of the board of directors of the Prisa group, who will be a proprietary director. The Escribano brothers' firm, for its part, owns 3% of the company and has already expressed interest in expanding that stake in the future to 10%.

Indra, therefore, is configuring a nucleus of trust and the future. Some internal debate has even addressed the possibility of leaving the Stock Market to grow exponentially, outside the exhaustive control of the regulator. But this possibility is not, for the moment, on the horizon. "Our competitors, Thales and Leonardo, are listed, it doesn't make any sense, at least for now," they point out internally.

Neither is the wish expressed in public by Oughourlian himself to segregate Indra, at least at this time, open to debate. "We are pushing for a division of the company between technology and defense or a total sale or merger of the technology division," said the head of Amber in an interview on Bloomberg. The Government did not see this option favorably from the beginning and today the company's priorities are the aforementioned, they point out.

Indra wanted this Thursday to have a gesture with investors and proxies. The council advanced that it will take to the shareholders' meeting the expansion to sixteen in the number of members, a decision that must have the approval of the owners of the company. Specifically, Indra will propose incorporating María Ángeles Santamaría Martín, an industrial engineer and specialist in renewable energies, and Elena García Armada, an industrial engineer and president of the biotechnology company Marsi Bionics, as non-attached directors.

The appointment proposal, Indra explained, "will make it possible to comply with recommendation 17 of the code of good governance, with at least half of the independent directors out of a total of sixteen directors." Indeed, the slamming of the door that Arendt gave as an independent director left these figures in a minority in the governing body. He will be sixteen posts. There are eight not attached to the company, five proprietary (at the proposal of the Sociedad Estatal de Participaciones Industriales, the main shareholder, of Amber and SAPA) and three executives, the president, Marc Murtra, the CEO, José Vicente de los Mozos , and Luis Abril, general director of the technological area.

Banco Santander issued a financial report yesterday assessing as positive the urgency with which these changes of members in Indra have been undertaken to guarantee the balance between independent and seconded, as suggested by the rules of good corporate governance. It would be necessary to make a new reserve on the board of directors if Escribano increases his participation from 3 to 10%, at which time he could have a position on the body.

In addition, with the arrival of two women as new members, Indra will advance in compliance with the future parity law, which contemplates a minimum female quota of 40% on the boards of directors. After the meeting there will be 37.5% female presence. The puzzle is fitting.