Abertis throws in towel and exits Brisa

Spanish toll road operator Abertis has “finally made the decision” to accept a takeover offer tabled by Portuguese conglomerate Jose de Mello and fund manager Arcus Infrastructure Partners (Arcus) and sell its stake in Portuguese toll road operator Brisa, the company announced today.
 
“In light of its [Brisa’s] traffic deterioration and its results in Portugal, and in view of the revision of the bid price by the CMVM [the Portuguese regulator], Abertis finds appropriate to make a step forward in its strategy of only investing in those projects in which it can assume an industrial role, allow for financial consolidation and create value for its shareholders,” Abertis explained in a statement.
 
Abertis added it expects to get €312 million in cash from selling its 15.02 percent stake in Brisa and estimates the sale will have a €97 million impact, “at the income statement level”, in the second half of the year.
 
The sale announcement is a victory for Jose de Mello and Arcus, which are offering Brisa’s shareholders €2.76 per Brisa share – a €0.10 increase from their original €2.66 per share offer – to take over the company. Jose de Mello and Arcus already own 49.57 percent of Brisa.
 
Abertis – flanked by a group of minority investors that included Franklin Templeton and the State of New Jersey Pension Fund – had resisted the consortium’s original takeover offer for Brisa complaining it “clearly undervalues Brisa” and pointing out that Brisa itself spent 2011 buying back shares at an average share price of €4.18 per share. Brisa at one point in 2007 commanded €10 per share.
 
For long-time industry observers, the sparring between Portugal’s Jose de Mello and Abertis smelled of a reckoning, considering how antagonistic both companies’ relationship had become after the de Mello conglomerate thwarted a Brisa/Abertis merger in 2007.
 
Following the original takeover announcement, Vasco de Mello, chief executive of the de Mello conglomerate and head of Brisa, dryly summarised the lack of control Abertis was facing at Brisa:  “If Abertis does not want to sell at this price it is welcome to keep its stake [in Brisa].”
 
Abertis, which has recently teamed up with Brookfield to buy at least 60 percent of toll road operator OHL Brazil – a deal that, if successful, will turn Abertis into the world’s largest toll road operator – decided not to keep its stake.