ACS is still looking for the financial muscle to be able to make a counter-bid for Abertis, Although the company has the capacity to generate cash and has a solid financial situation, it would need the help of foreign investors to take on the acquisition. To better Atlantia’s bid, ACS will have to offer over 16,5 euros per share.
Brookfield and some Middle Eastern sovereign funds were amongst the first names tipped as potential partners for ACS. Now it’s Macquarie that ACS has had talks with, given that the Spanish firm’s new CEO, Marcelino Fernández Verdes, has an excellent relationship with the Australian infrastructure company. Fernández Verdes was in charge of the restructuring of Cimic, ACS’ subsidiary in that country.
We maintain our view that the most likely outcome will be an improved offer from Atlantia (it has in fact had to improve some aspects of its current 16,50 euros per share bid) or else a more attractive alternative. This could be ACS, in collaboration with a financial partner, and Criteria/Caixa Bank remaining with its 22.3% stake.
Bankinter analysts believe that Abertis offers an investment profile which is attractive to international investment funds.
“Not just for infrastructures, for the stability and predictability of its business and its dividend yield (approx 5%). For that reason, we think it’s likely that a third party will improve on Atlantia’s bid. So we are keeping the stock in our model portfolio based on how that develops.”
If the first bidder, Italy’s Atlantia, does acquire Abertis, it’s main objectives would include breaking into the US and Australia, the two big markets at the moment.
Currently both groups are very exposed to the European markets, which are already mature and offer very few opportunities, as well as Latin America. But continuing to grow in that region could imply too much risk.
The combination of Atlantia and Abertis would create the biggest motorways operator in the world, with proforma 2016 EBITDA of 6.6 billion euros and investment commitments for a total of 26 billion euros. The offer, which values Abertis at 16.4 billion euros (16,50 euros per share) is pending approval from the competition authorities.
