Atlantia, the Italian infrastructure group, has given its strongest signal yet that it intends to raise its €16.3bn bid for Spain’s Abertis in order to thwart a rival offer from Hochtief of Germany and prevail in one of Europe’s biggest takeover battles.
“We believe we have room to make our offer adequately competitive, at the right moment, without jeopardising value creation,” said Giovanni Castellucci, Atlantia’s chief executive, in an interview with the Financial Times in his office on the outskirts of Rome.
“The price of our offer was a fair price, but not our reservation price,” Mr Castellucci added, referring to the maximum level his company was willing to pay.
Mr Castellucci’s remarks show how determined Atlantia remains in its pursuit of a deal, despite the competition from Hochtief, which is 72 per cent owned by ACS, the Spanish construction group, and last month offered a mix of cash and shares worth more than €18bn for Abertis.
Atlantia, which is controlled by the Benetton family, made its offer in May in an effort to create a European champion with a global business spanning highway toll roads, railways and airports. It valued Abertis at €16.50 a share, with an option for investors to take up a portion in Atlantia shares.
An improved offer from Atlantia is not expected until the Spanish stock market regulator gives a green light to Hochtief’s bid, possibly as early as next month. But if it happens, some analysts say that Atlantia may be able to pay up to €19 per share before the offer begins to backfire financially.
Since making its offer, Atlantia has been frustrated by the slow pace with which the Spanish stock market regulator approved its bid, as well as the perception that some officials in Madrid were encouraging the rival bid from Hochtief as a means to preserve Spanish ownership.
The chief executive of ACS is Florentino Pérez, the long-time president of Real Madrid football club.
Mr Castellucci would not be drawn on the Spanish government’s stance in the fight. “The theme is not Italy versus Spain. It is about the free market and the foundational principles of the EU,” he said.
“We believe our industrial project is good for both companies and for Spain,” he added, stressing that Abertis would remain listed with its headquarters in Spain, and the combined group’s Latin American assets, which are performing strongly, would be transferred to Abertis.
Mr Castellucci dismissed the impact of the crisis in Catalonia in the takeover battle, saying Abertis’s value was mainly based on its assets outside of Spain and, in any case, Atlantia was “convinced that the Catalan crisis will be resolved, because it is not rational that it won’t be”.
The board of Abertis said last month that there was “margin for improvement” on the price of Atlantia’s offer but it was “attractive”, triggering hopes on the Italian side that they were seen as the better option.
“We think the same way, we do the same job and we’ve known each other for 10 years. There’s trust between the management teams,” Mr Castellucci said. The German bid backed by Mr Perez has a paper component, and some investors doubt they will be able to deliver on their promise to deliver a big expansion based on greenfield investments.
Hochtief tried and failed to find other partners to join the bid over the past few months. After rising above €19 last month on the back of the Hochtief bid, Abertis has since fallen to €18.36 — below the €18.76 level of the German offer.
Last month, Atlantia also received EU antitrust clearance for its bid, removing another element of uncertainty hanging over it. “You will still have competition on the European markets but this will be a world number one in operating toll roads,” said Margrethe Vestager, the EU’s antitrust commissioner, in a briefing with reporters.
Fuente: Financial Times