Related Party Transactions

3 Months Ended

Mar. 31, 2020

Related Party Transactions [Abstract]

Related Party Transactions

Note 15 – Related Party Transactions

MasTec purchases, rents and leases equipment and purchases various types of supplies and services used in its business, including ancillary construction services, project-related site restoration and marketing and business development activities from a number of different vendors on a non-exclusive basis, and from time to time, rents equipment to, or performs construction services on behalf of, entities in which members of subsidiary management have ownership or commercial interests. For the three month periods ended March 31, 2020 and 2019, such payments to related party entities totaled approximately $25.3 million and $28.5 million, respectively, and the related payables totaled approximately $6.4 million and $14.7 million as of March 31, 2020 and December 31, 2019, respectively. Revenue from such related party arrangements totaled approximately $1.0 million and $0.3 million for the three month periods ended March 31, 2020 and 2019, respectively. As of March 31, 2020, related amounts receivable, net, totaled approximately $0.1 million, and as of December 31, 2019 were de minimis.

In 2018, MasTec acquired a construction management firm specializing in steel building systems, of which Juan Carlos Mas, who is the brother of Jorge Mas, Chairman of MasTec’s Board of Directors, and José R. Mas, MasTec’s Chief Executive Officer, was a minority owner, for approximately $6.1 million in cash and an estimated earn-out liability of approximately $1.4 million, net, as adjusted. Amounts outstanding for advances made by the Company on behalf of this entity totaled approximately $0.7 million and $0.5 million, net as of March 31, 2020 and December 31, 2019, respectively, which are expected to be settled under customary terms associated with the related purchase agreement.

The Company rents and leases equipment and purchases equipment supplies and servicing from CCI, in which it has a 15% equity investment. Juan Carlos Mas serves as the chairman of CCI, and a member of management of a MasTec subsidiary and an entity that is owned by the Mas family are minority owners. For the three month periods ended March 31, 2020 and 2019, MasTec paid CCI approximately $0.3 million and $6.0 million, net of rebates, respectively, related to this activity. As of March 31, 2020 and December 31, 2019, amounts payable to CCI, net of rebates receivable, totaled approximately $1.4 million and $0.2 million, respectively.

MasTec has a subcontracting arrangement with an entity for the performance of construction services, the minority owners of which include an entity controlled by Jorge Mas and José R. Mas, along with two members of management of a MasTec subsidiary. For the three month periods ended March 31, 2020 and 2019, MasTec incurred subcontracting expenses of approximately $0.7 million and $1.6 million, respectively. As of March 31, 2020 and December 31, 2019, related amounts payable totaled approximately $0.6 million and $0.2 million, respectively.

MasTec has a leasing arrangement for an aircraft that is owned by an entity that Jorge Mas owns. For the three month periods ended March 31, 2020 and 2019, MasTec paid approximately $0.6 million and $0.7 million, respectively, related to this leasing arrangement.

MasTec performs construction services on behalf of a professional Miami soccer franchise (the “Franchise”) in which Jorge Mas and José R. Mas are minority owners. Services provided by MasTec include the construction of a soccer facility and stadium, including wireless infrastructure services. For the three month period ended March 31, 2020, MasTec charged approximately $4.0 million under these arrangements, of which $3.6 million was outstanding as of March 31, 2020. Payments for other expenses related to the Franchise totaled $0.2 million for the three month period ended March 31, 2020.

MasTec leases employees and provides satellite communications services to a customer in which Jorge Mas and José R. Mas own a majority interest. For the three month periods ended March 31, 2020 and 2019, MasTec charged approximately $0.3 million and $0.4 million, respectively, to

this customer. As of March 31, 2020 and December 31, 2019, outstanding receivables related to these arrangements totaled approximately $0.9 million and $0.8 million, respectively.

Split Dollar Agreements

MasTec has split dollar life insurance agreements with trusts, of which Jorge Mas or José R. Mas is a trustee. There were no payments made in connection with these agreements in either of the three month periods ended March 31, 2020 or 2019. As of both March 31, 2020 and December 31, 2019, life insurance assets associated with these agreements totaled approximately $20.3 million.