A profile of the driving force behind Ferrovial's bid for BAA
19.02.06
When Spanish construction company Grupo Ferrovial announced that it was considering a cash bit for UK airport's operator BAA less than two weeks ago, it came as a surprise. Since then, shares in BAA are up 25%, with some targeting a further similar rise. Interest in Ferrovial has also increased, such that today newspaper The Business published an article about its Chairman and driving force, Rafael del Pino.
Rafael del Pino, chairman of Spanish construction company Ferrovial, is the eldest son of Ferrovial's founder, Rafael del Pino senior, Spain's second richest man. His training include a civil engineering degree from the prestigious Escuela de Caminos and an MBA from Massachusetts Institute of Technology's Sloan School of Management. He also did a stint with the Boston Consulting Group in Paris.
It seems he was destined to take over the reigns of the company his father built over 50 years in Spain and Latin America - starting by laying rail tracks and ending by building Bilbao's shimmering Guggenheim Museum - and turn it into global construction giant big enough to rival anything internationally.
In interviews, Del Pino junior has speculated about the big deal which could transform the company. A bid for BAA, which including debt could be worth £15bn and may arrive within weeks, fits the criteria.
A Spanish analyst says: 'He was born rich, but having been born rich, as opposed to just lying in the sun and taking advantage, he's aiming to replicate what his father did at a different scale. He's aiming to build one of the largest construction companies in Europe.'
Another analyst adds: 'The MBA in the States - with all his wealth, he didn't really need to do it. We all remember his father, but he wants to be remembered as a tycoon as well.' And a UK financier who was pulled in to meet Del Pino a year ago says: 'I went in thinking, 'this is just the son of the guy who started everything', and went away thinking, 'this is one of the leaders in the European infrastructure business'. He's incredibly smart.'
Del Pino, 48, is more introverted than his father and intensely shy of media scrutiny. But those who have dealt with him say he is charming in person, with only a trace of a Spanish accent. He has a way with probing questions that allows him to soak up far more about others than he gives away about himself, and a direct style unusual among Spanish businessmen.
His outlook is doggedly global, and he devoted far more of his time scrutinising international opportunities than managing the company's Spanish businesses. His father remains his mentor, Del Pino admitted to a Spanish newspaper a few years ago.
After serving as an artillery officer in the civil war, aged 17, Del Pino senior, now 86, also trained as a civil engineer at the elite Escuela de Caminos, along with many of the older generation of Spain's business leaders. After travelling Europe picking up building techniques, he became known as 'El Rey de Los Ladrillos' - the king of bricks.
The company expanded rapidly, taking advantage of Spain's post-war reconstruction, and also picking up contracts to build motorways in North Africa and Latin America. Del Pino junior git a firm grounding in the business before being promoted to chief executive in 1992 and taking control in 2000. His brother Fernando and sister Maria sit on the Ferrovial board, but it has always been Rafael, the oldest, who was groomed to take over.
A widower, his chief concern beyond building the business, is his three sons. He enjoys anything that takes him away from the world of business and into confrontation with the elements. In 2002, the four of them took their yacht across the Atlantic, a trip, Del Pino proudly recalls, that saw them braving Force 6 gales.
He's also keen on cross-country skiing, decking out his skis with skins and pushing off into the unknown, although he complains that in the 15 times he's visited the World Economic Forum in Davos, he's only managed to make it to the slopes five times.
In his business life, though, Ferrovial's bid for BAA is his biggest challenge. Ferrovial, with a market value of €9bn, is taking on a company with a market value of around £8.5bn. Del Pino is putting on the table everything his father painstakingly built up over 50 years.
That doesn't surprise anyone in Spain. One analyst says: 'He's not managing this as a standard family company that doesn't want to take risks.'
Allan Moss, the boss of Australian bank Macquarie, is credited with the realisation in the 1990s that infrastructure such as roads, airports and utilities was perfectly matched to the investment needs of pension funds. But Del Pino was not far behind in seeing the opportunities this could bring the construction and asset management firms that partnered them.
Ontario Teachers' Pension Plan was a long-term investor in Macquarie's funds, but Ferrovial has typically worked with the Francophone Caisse de Dépot et Placement du Québec, who backed them on the Highway 407 deal, and are reportedly the main backer on BAA.
His father's management style was based on force of personality, the son in contrast likes to give his managers a freer rein, fostering an entrepreneurial culture. Analysts say he shares his power with chief executive Joaquin Ayuso, vice chairman Santiago Bergareche, and chief financial officer Nicolas Villen. They, in turn, give considerable autonomy to the heads of the company's four arms - construction, infrastructure, real estate and services.
Although Del Pino senior's life stands as one of the Spanish business world's most striking success stories, his last years have been fraught with tragedy. He captured Spain's imagination on retirement with his plans to retrace Jules Verne's voyage around the world on his €12m luxury yacht Alcor, flying in friends to accompany him for the various legs of the trip.
Articles compared the then 82-year-old adventurer to Magellan. But the trip was tragically cut short when he was left paralysed by a fall on board. Now, his ambitions for his retirement sadly curtailed, his hopes are on his son's efforts to take his legacy onwards. For the Del Pinos, BAA is more than just a deal.
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