Misteri1963

Large funds refuse to participate in the ACS by Abertis due to its financial risk

Expansion of Hochtief at price of demolition, financing costs significantly higher than those of Atlantia, risks due to the maturity of the Abertis concessions ... Florentino Pérez's plans to undertake counter-offer frighten the most qualified investors.

The president of the ACS group, Florentino Pérez.

BY RAÚL POZO11/10/2017 - 04:00

ACS's plan to build a bid for Abertis , which competes with that of Italy's Atlantia , has led to the rejection of some of the large international investment funds whose support has been surveyed by the construction and services group headed by Florentino Pérez . The main reason has been the financial risk involved, so high that some of the entities have come to describe the proposal as very risky and even dangerous.

The market does not agree when it comes to betting on the possibility that ACS will end up presenting an offer for Abertis , although there is a general coincidence in pointing out that, if it finally does, it will be very accurate.

Investors point out that ACS is encountering so many problems to finance a major operation like this, given the current abundant liquidity in the market. Precisely, the reasons are those serious financial risks that have located the funds and that have made the construction company and services find many obstacles to arm the supply.

At the moment, ACS has not been able to close a capital increase of its German subsidiary Hochtief , through which it tries to articulate the possible OPA on Abertis. The main problem that Perez has found when seeking support to cover this expansion is that the German company's securities are triggered on the Stock Exchange , which are notably overvalued.

Demolition discount

As it shows, the fact that Hochtief does not currently have any recommendation to buy between the analysis firms that follow the value, while only three are 'maintain' and almost a dozen are for sale.

Given the negative response of the market, ACS is considering offering an attractive discount on the expansion of Hochtief . However, even with figures in the environment of 20%, the response of investors does not ensure the success of the operation. In addition, it would penalize in a remarkable way an asset of the company as it is its participation in the German constructor, that at present sciende to something more than 70%.

Another reason that makes risky the offer that ACS tries to articulate is the cost of financing , which would exceed 3.5% at best. A figure that contrasts with that presented by Atlantia in the offer pamphlet that was validated Monday by the National Securities Market Commission (CNMV) , which stood at 1.9%.

A circumstance that facilitates to the Italian company to improve in any case an offer that could present ACS , that could be in the surroundings of the 17 euros per action. Abertis has been trading for several weeks over this quota, pending the offer of the Spanish construction company to make Atlantiareact and raise the price of its proposal, which is 16.5 euros per share.