Everybody, welcome to today's webcast to discuss the closing of the acquisition of Iberdrola México, which we announced, its strategic rationale, the acquisition financing, and most importantly, the takeout of the initial $2.65 billion bridge loan through a $2 billion 144A/Reg S bond, which closed last week, and the already secured term loan for the remaining amount, which has greatly improved our capital structure. Let me introduce myself. I am Begoña Morenés, Global Head of Investor Relations for Cox ABG Group.
With me today are our Group CEO, Mr. Nacho Moreno, our Group CFO, Mr. José Olivé, and our Group Head of Strategy and Corporate Development, Mr. Javier García-Arenas. We will go through a quick presentation first, led by our CEO and CFO, and then open the floor to any and all questions you may have in the Q&A session. If you wish to ask a question, you can do so during the presentation and in the Q&A session through the webcast platform. Without further ado, I leave you with our CEO. Nacho, the floor is yours.
Thank you very much, Begoña, and thank you all. Good afternoon, everyone, and thank you all again for your time today. As Begoña mentioned, the aim is to drive you guys through again, the what, the why, and the how following our full- year results presentation in which we, you know, we discussed and we announced again the Iberdrola México acquisition. Key messages, and I'm on page four. Key messages that I would like to leave you, leave with you know, throughout this presentation. First one is a message of over-delivering. We think last time that you heard me speaking about it, we told you guys that we were just about to close the transaction. It was matter of weeks.
Not only we have closed the transaction in the timeframe that we committed to or that we announced to the market, but we've also been able to refinance the short-term bridge financing that we had entered into in order to fund the transaction. That brings me to the second point, which is validation by I think one of the most difficult markets worldwide, which is the 144A market in the U.S. As you guys may have witnessed last week, we refinanced, sorry, our short-term bridge loan facility through a 144A bond, long five years and 10 years as we will further on discuss, achieving, you know, more than 5 x oversubscribed.
That was a clear validation by the U.S. investor, bond investor community of the transaction and the story, the great story that we discussed with them. Last key message that I would like to leave with you is one of transformation of the company. You've heard us day in and day out talking about how transformational was the Iberdrola México acquisition for the company, how was it a once in a lifetime opportunity. I think it, you know, how stable, predictable, recurrent revenue, EBITDA, and cash flow would bring to the company.
Since the very beginning of our story with the markets at IPO, we announced and we communicated that we were going to grow on our AssetCo division, our management and operation of infrastructure division, in order to look for a stable, predictable, recurrent revenue, EBITDA, and cash flow conversion and cash flow generation. The acquisition of Iberdrola México is nothing else but that, you know, bringing a stable, predictable, and a recurrent revenue, EBITDA, and cash flow generation to the company. Turning into the page, and turning into the how did we fund it, and deepening into it for a second.
As we commented or we discussed at the results presentation a few months ago, a couple of months ago, it's been a EUR 3.5 billion cash consideration acquisition, EUR 850 of which have been committed through capital injection by the company. EUR 500 of cash equity injection from Cox Parent company, EUR 350 from strategic partners through the injection of subordinated term equity consideration capital. Alongside EUR 2.65 billion worth of bridge facility that has been refinanced already in the bond in the capital markets, in the bond market, through a 144A, as I just mentioned, with a long five years and a 10 years, multiple times oversubscribed, more than 5 x.
That enabled us, allowed us, not only to increase the initially targeted size, which was $1.5 billion - $2 billion, but also tighten the price significantly. That, you know, the remaining $650 million-$700 million has already been committed by the banks and will be taken out through a further syndication, you know, within the next two or three weeks in the term loan market in a five-year transaction, which would be amortizing. Key two messages that I would like to leave with you with regard to the how.
A, you know, we've been able to refinance more or less at the same time as at which we were financing the transaction, enabling the company to enter into a longer-term capital structure with no pressure whatsoever. We've been able to remove any potential financing overhang. That was, you know, around the company. B, we've been able to validate the acquisition, the story, with one of the most complex investor bases that currently exist, which is the 144A market. One of the most strict investor bases that exist, which is the 144A market investor base with, you know, multiple times over subscription. That, I think, is a clear testimony of how much the story is validated or should be validated.
Turning to the what, which is I'm on page eight. What have we acquired? Again, you may have heard me talking about this beforehand, but any case, I thought it would be interesting to further deepen a bit into what have we acquired. We've acquired, I was gonna say, the best integrated platform in Mexico, but actually it is the only integrated platform in Mexico. It is the only integrated utility in Mexico. In by integrated, I mean one that combines generation alongside supply. We've been able to you know, to acquire the top five largest generation platform in Mexico with 2.6 GW of own capacity, plus 1.3 GW of acquired capacity, with quite brand-new plants having more than 27 years of estimated remaining life and with 90%+ availability.
Well-proven generation platform alongside the top one qualified supplier in the region, in the country, with more than 500 clients, extremely low delinquency rate, lower than 0.13%, and very high renewal rate, more than in excess of 99% renewal rate. It is one of those cases in which we are able to choose our clients, and we only work with the clients that we would decide to work with. If I had to summarize the platform that we acquired, I would say, as I said, unique platform, unique integrated utility in the system, one that allows us to optimize margins, both on the generation side as well as on the supply business. One that presents extremely high barriers of entry to any potential competitors.
If you compare our company with any of the other utilities in Mexico, you will find out that, A, we are the only one that is integrated, as I said, B, why are the others not integrated? Why have they not created a supply business? Because it takes, you know, more than a decade to build up such a supply business as the one that we've acquired. That creates extremely high barriers of entry, not only, which are natural not only to the generation business, but also to the supply business. That unique platform, unique company, is extremely well-supported, as I said, by a top five generation platform, combined with the top one supply company.
Extremely well-supported by management that has been driving, that built up the company and has been driving the company for more than 20 years. As you will hear me throughout the presentation, this is a plug-and-play situation. You will not hear us talking about hurdles to integration and asking for, you know, months to integrate the company. It's a plug and play. What was being operated under the Iberdrola brand two weeks ago, two weeks ago, you know, from two weeks ago, it's been operating by under the Cox brand in extremely the same shape. It's a plug-and-play situation, not a situation of integration and any hurdles should be expected from that. It is in the right geographies for us. A geography which we know inside out.
As you know, Cox had a supply business, you know, of, you know, much lower size than Iberdrola's, but definitely one that allowed us to get very comfortable with the region, get to know the ecosystem, the financial ecosystem, the regulation, the regulators, and bottom line, to get fully comfortable with the region in order to make this investment. One region that has got the right demand supply dynamics. If you think about the country in itself, it's been heavily underinvested over the past few years in generation, at the same time in which the power demand has clearly outpaced the GDP. It's grown.
The power demand has grown, you know, in excess of 2.5% per year, and it is expected to keep on growing at the same pace up until, you know, end of the 2030s. Up until 2039, 2040. Those dynamics are clearly favorable to the investment that we have just made. All of this, under very strict and solid financial policies and benefiting from, you know, a message that I've already hinted to you at, you know, at the very beginning of the presentation. Benefiting from stable, predictable, recurrent revenue, EBITDA, and cash flow, and cash flow conversion, which is what you have got in the following page. Out of this page, which is quite heavy on numbers, we just want to leave you with, you know, three numbers.
Revenues in excess of $1.5 billion, EBITDA EUR 614, cash flow EUR 347, and cash flow conversion, which is well in excess of 50%. That is extremely predictable. It's, again, very recurrent, predictable, and stable, and that's something that you should expect year in, year out. We've gone through how did we fund it? We've gone through what have we acquired? Let's go now in a bit more detail of what does it mean for Cox as a group. On page 11, you've got an overview, a picture of how does Cox look like today.
The fact is that we've, again, delivered what we told at IPO that we were going to be focused on delivering, which is growing in a management and operation of owned infrastructure in the water and energy front, growing our AssetCo base. This is what we've done through the acquisition of Iberdrola México. Okay, up to a point, turning page to page 12, in which if we had run on a pro forma basis the numbers for 2025, we would have moved from EUR 1.2 billion or EUR 1.15 billion in revenues to more than 2x- 2.5 x. EBITDA would have been multiplied by 3 x closer to the EUR 800 million worth of EBITDA.
Operating cash flow, adjusted operating cash flow would have moved from EUR 127 million to close to EUR 600 million on a pro forma basis. Our AssetCo EBITDA weight in the company's total EBITDA would have moved upwards from 64% up to 90%, which means delivery of something that we had committed to at IPO level. At Cox Asset Mexico level, at the downstairs, as we tend to call it, level, it is all a question or it is all a story about deleveraging. Which is why we have combined a bond transaction as refinancing instrument alongside a term loan.
The term loan allows us to deleverage the company, make good use of the excess cash flow generated at Cox Asset Mexico in order to deleverage the capital structure moving from a 4.3 x existing capital structure, which we know and are aware it's quite heavy, to a well underneath 3 x in 2030. Okay? At that time, as we told the bond investor base, we would have expected and we would expect to achieve the investment grade ratio or investment grade category at the Cox Asset Mexico level. What can you guys expect in the medium term? You know what we are today.
We're a company that, you know, it has clearly or reinforced its bias towards AssetCo, you know, with EBITDA now weighting 90% plus versus a previous 64%, which is heavily concentrated in delivering stable, predictable, recurrent revenue, EBITDA and cash flow. Which is totally aware of the leverage downstairs, but has a clear path to the leverage and a path that should drive us towards the investment grade category. And that's what we are today, a much larger company by every metric that you measure up us with, whether it's revenues, whether it's EBITDA, or whether it's cash flow, adjusted operating cash flow. What should you expect in the medium term? You should expect a company which is able to capture, you know, the right growth opportunities whilst preserving financial discipline.
You heard, you heard me and, you know, my CFO throughout every single presentation that one of the key things and the key messages that, you know, we abide by is maintaining a solid financial discipline. You've heard me about deleveraging, our commitment to deleverage, to including a term loan in order to allow us to deleverage, you know, downstairs, et cetera. We will capture growth opportunity whilst we preserve financial discipline. We are extremely focused in creating shareholder value through visible cash flow growth, which is nothing else and nothing more than what we have done through the acquisition of Iberdrola México.
If you think about Iberdrola México as a cash-on-cash per share basis or on a cash-on-cash per share basis, we think we are convinced within the company that we have been able to create, you know, good shareholder value through the acquisition. It was a once in a lifetime opportunity because it enabled us to do so. In order to finalize and leave the floor to you guys, going into page 15, we have definitely delivered, and I would say more over-delivered. Whenever you embark yourself in one of these quite large transactions, you do not expect, you know, to finance it and refinance it in a, you know, in the long-term markets within a two weeks or one week, 10 days timeframe. That is what we have done.
Removing, as I said, any potential financing overhang that was surrounding the company. We've clearly changed, transformed the company. We've increased the visibility and predictability of long-term contracted cash flows. Again, stable, predictable, recurrent, boring. We've become extremely predictable, extremely boring in that regard. We've clearly enhanced our position as an integrated international energy and water infrastructure platform, benefiting from the fact that we've acquired the only integrated utility in Mexico with barriers to entry and allowing us to optimize margins on both generation as well as distribution or supply. Sorry, not distribution, supply. We're extremely focused on prioritizing cash generation within the financial discipline I've just mentioned. We will execute a selective and value-driven long-term growth strategy.
Not to be ignored, we have a much broader access to a much larger funding platform, as we've been able already to access the U.S. investor platform. We will keep on doing so if and when needed. On that note, I will hand it back to you, Begoña, to answer, address any potential question that may have come from investors. Thank you very much again for your time today.
Thank you, Nacho. Just a reminder to anybody, if you wish to ask a question, please do so on the webcast platform. We'll start the Q&A in just an instant. The first question today is a combination of two people, Mr. Oscar Najar from Banco Santander and Mr. Juan Cueto from Renta 4. The question is, can we have more details about the equity portion of the funding of the acquisition of Iberdrola México? The questions in detail have to do with the cost, with whom the preferred equity has been taking place, and how we are going to finance this, taking into account the level of cash that Cox announced in its previous results.
Thank you, Begoña. As I said, the funding structure has been $850 of equity, $2.65 of bridge facility. Leaving the bridge facility aside, pref equity, $350 million has been placed with Allianz, Gramercy, and GMO. Worth noting that those $350 million were initially oversubscribed, and Allianz decided to give way to those two guys, Gramercy and GMO, who are frequent co-investors alongside Allianz in other transactions. It was not marketed at all. It was placed with Allianz, and Allianz decided to bring in Gramercy and GMO. We're extremely happy with, you know, them bringing in those two guys because they're long-term partners and extremely solid investors.
The $500 million remaining, which was injected by Cox Parent and company, let's call it that way, was a result of a combination of existing cash and available financing the company had in place. That available financing the company had in place had a tenor beyond three years, or has a tenor beyond three years. It's all bullet with a tenor beyond three years.
Thank you, Nacho. The next set of questions comes from Ignacio Domenech from JB Capital. First one of them is, how is the asset rotation program progressing?
It's progressing quite well. In fact, next week, we've got I mean, the first Well, not the first one, but kind of the inception of, you know, a One of the key assets that we're gonna be rotating, is somehow getting some, you know, final figures, final numbers as of, as of Wednesday. In fact, as of tomorrow. And that is, I think, the most significant asset, that we will be rotating. It is taking place quite good as we speak.
On the other hand, you should also take into consideration that, you know, the company through the acquisition of Iberdrola México has got now much more, many more levers, not only, you know, predicated not only on existing assets that will be rotated, but on, you know, other capital alternatives that could replace, at a certain point in time, asset rotation. Those are being explored as we speak. In combination with the asset rotation program, which is, you know, up and running, and as I said, first one hopefully will, you know, have, you know, flesh on the bones as of Wednesday. We have been able to add, you know, new capital levels, which, you know, will also enhance and boost the asset rotation program that we communicated at our Capital Markets Day.
On that, in that regard, you know, you will hear good progress certainly in, you know, hopefully in our half-year results presentation at the end of July. Certainly, you know, throughout the year or following the month of July and August.
Thank you, Nacho. The next question from Ignacio: What is the best estimate for financial costs in 2026, and what is the average cost of debt?
Upstairs and downstairs. I would say upstairs, it's underneath, well underneath, it's around 9%, high 8s, low 9s. Downstairs, it's more or less around the 7-ish, 7.5% I would say. I would need to come up with the, with the average maturity profile, but it should be in anywhere between 7.25% and 7.5%. Again, downstairs, we're talking about an average debt maturity profile, which should be in the range of six years, more or less, seven years maybe. Upstairs, we should be talking around beyond three years, anywhere between three and four years.
Thank you, Nacho. Last question from Ignacio. Now that the transaction in Mexico is closed, can you share with the market guidance for 2026, i.e., P&L levels and net debt?
I don't think we can yet share my guidance for 2026, Ignacio. I'm sorry for that, but I don't think we can share that yet.
Thank you, Nacho. The next question comes from Pedro Garnica from Alantra Equities. How should we think about Cox Group midterm in terms of the mix between energy and water assets?
Thank you, Pedro. I think the way to think about the company going forward is, as we said from inception, it's an integrated utility of energy and water, of water and energy. We will continue being focused on management and operation of those two key core infrastructures. Obviously, the presence that we've acquired in Mexico through the acquisition offers us unbelievable opportunities of developing, of getting ourselves into, you know, water assets that, you know, we did not have that access to. So I'm pretty sure that, you know, the size that we've got following the acquisition of Iberdrola México would open us doors that on the waterfront that were not opened beforehand.
The way to think about us going forward is exactly the way to think about us previously, which is integrated utility of water and energy, and because those are the only two activities that we'll keep on doing. You will hear that any water opportunity operating asset, you know, similar to Iberdrola México, you will see us contemplating it for as long as it is the right capital allocation, it, you know, it delivers sustained and stable cash flow growth, you know, to shareholders, et cetera, et cetera, et cetera. I don't think in that regard there's any change in direction, Pedro.
Thank you, Nacho. The next question, also from Ignacio from JB Capital. On the water concessions, can you give a timeline of tendering opportunities in 2026, and how is this progressing? The question is, do you see any opportunities on CapEx rebuild in the Middle East?
That's three in one. That's three questions in one. I'll start with the middle one, because it also ties up with the first one. Timeline, sorry, how are the tenders progressing in 2026, we'll be able to give you a full update, you know, whenever we release mid-year results, and you will, you know, hear from us on an opportunity by opportunity basis. Those are progressing quite well. You will see that there is quite a lot of improvement or advance that has been, or progress, sorry, that has been made. I do not have the you know, details of each one of the tenders with me right now, but happy to update you guys on that front on a one-on-one basis or if you wish to do so.
You will see good progress with regard to any potential tender in 2026 with clear identified opportunities that, you know, are about to be finalized or in the way to be finalized. Do I see any opportunities on CapEx rebuild in the Middle East? Certainly, but before getting into any potential CapEx rebuild opportunity discussion, I think we should, you know, allow for that region to go back to basics and go back to stability. You know, I don't think we're yet in a position to properly analyze, you know, Middle East CapEx rebuild opportunities yet.
We need to, you know, for that region to stabilize further, then definitely not only rebuild opportunities, but also, you know, think about the security implications of, you know, for the water infrastructures. It is not only rebuild, but also build on.
Thank you, Nacho. That was the last question for today. With this, we finalize the Q&A session. If you do have any further questions, Investor Relations department remains at your disposal. I'll give the floor to Nacho to say goodbye.
Thank you very much, Begoña. Again, thank you very much to all of you guys for having made the time and the effort to attend this webcast today. You know, hopefully, we've been able to leave you with the key messages that the company wanted to leave you with, one of over delivery validation, transformational acquisition, and stability of revenues, EBITDA, and cash flow. As Begoña said, we will remain at your disposal should you have any further question. Thank you very much.