Renta 4 | In line with information in the el Economista daily, BBVA would have prevailed over minority shareholders (MERLIN Properties and SANJOSE) in the arbitrage over the sale rights in Distrito Castellana Norte (DCN) project.
The Arbitrator, D. Miguel Virgós, has communicated his decision to the parties involved. This means the Spanish bank, chaired by D. Carlos Torres, will be able to sell its 75.54% stake in the project, without the other minority shareholders (MERLIN and SANJOSE) having any preferential right and right of withdrawal in this transaction.
According to the information in the press, MERLIN in principal does not intend to appeal the decision.
We recall that MERLIN has a 14.46% stake in Madrid Nuevo Norte, while SANJOSE has the remaining 10%.
Valuation: This news has a negative slant for the MERLIN, given the long-term strategic nature of the project for the SOCIMI. That said, we believe that despite having lost the arbitration decision, MERLIN has gained time in the process, taking advantage of this to carry out the divestment of the portfolio of BBVA offices and deleverage its balance sheet. It now has a larger financial margin ahead of an eventual bigger operation in the project.
We recall that at the close of 9M’22, MERLIN Properties had NFD of 3.694 billion euros (LTV of 31%), 99.6% at a fixed rate and 97.9% corresponding to corporate debt (non mortgage).
We reiterate our OVERWEIGHT recommendation, with a T.P. of 10,30 euros/share.
