ACS, La Caixa confirm talks with CVC on Abertis buyout

The stakeholders have confirmed discussions with CVC for the private equity firm to become a shareholder in Abertis, which may involve a buyout of the developer. Reports suggest CVC will inject the majority of the equity needed for the buyout vehicle with debt coming from a bank club led by Mediobanca. The buyout could be worth over €25bn.

ACS and La Caixa – the main shareholders of Spanish infrastructure firm Abertis – have disclosed in regulatory filings that they are holding talks with European private equity firm CVC Capital Partners regarding the latter’s entry into Abertis’ share capital.

The discussions are “exploring” various possibilities for CVC to become a third major shareholder in Abertis, including the buyout of 100 percent of the company via a special purpose vehicle. Although ACS (25 percent) and La Caixa (29 percent) said they will continue to be shareholders in Abertis, they did not comment on whether their holdings in the company would increase or diminish as a result of a potential deal with CVC.

A report in Italian newspaper Il Messaggero values the equity component of Abertis’ enterprise value at €10 billion.

To pay for that amount, ACS, La Caixa and CVC would provide about €4 billion in equity – the majority of which would come from CVC – while Italian bank Mediobanca is putting together a 10-strong bank club to lend the remaining €6 billion in debt for the transaction.

The banks – including BBVA, BNP Paribas, Credit Agricole (Calyon), Intesa Sanpaolo, Societe Generale, Santander and Unicredit – would each provide tickets of €600 million, the newspaper reported.

Yesterday the Financial Times said the tender offer to Abertis’ minority shareholders would value the company’s equity at €12 billion, or more than €25 billion including Abertis’ debt. It also said Mediobanca was arranging the debt financing but pegged total debt at €8 billion for the deal.  Abertis’ market capitalisation on Monday before the announcement was €8.6 billion, said the newspaper.

Abertis posted a net profit of €119 million during the first quarter of 2010, a close to six percent increase relative to the previous comparable period. It derives over 70 percent of its revenues and 81 percent of its earnings before interest, tax, depreciation and amortisation (EBITDA) from its domestic and international toll roads business. The latter includes subsidiary Sanef, which manages close to 1,800 kilometres across France.

A spokesman from Abertis did not comment on the buyout news while CVC, La Caixa and ACS could not be reached for comment at press time.