ACS launches takeover of Hochtief

The Spanish construction firm has unveiled an all-stock offer to acquire full control of German infrastructure group Hochtief, in which it already owns close to 30%. ACS is offering eight of its own shares for every five Hochtief shares.

Spanish construction company ACS has announced a plan to take over the remaining 70 percent it doesn’t already own in German infrastructure group Hochtief via an all-share bid, it said in a filing to the Madrid Stock Exchange.
In its note to the Spanish regulator, ACS said it will offer eight of its own shares for every five shares in Hochtief, in which it currently owns close to 30 percent. ACS told the regulator that the share exchange ratio reflected the average share price of both companies over the last three months.
Based on yesterday’s closing price, the 70 percent of Hochtief that ACS does not own is worth about €2.75 billion. The Spanish company did not mention in its filing how it planned to finance the bid but Spanish newspaper ABC reported earlier today that it would use treasury stock and launch a capital increase to pay for the offer.
ACS has been divesting some of its assets in order to reduce its debt pile, recently selling a 15.6 percent stake in toll road operator Abertis to private equity firm CVC Capital Partners for €1.7 billion. Prior to that deal, it had divested its ports unit – Dragados Spl – to JP Morgan for €720 million.
Hochtief is Germany’s largest construction company and also runs a very profitable construction business in Australia via subsidiary Leighton Holdings. Hochtief’s stock was trading at €57.84 at 11.28am on the Frankfurt Stock Exchange, a 2.46 percent gain on yesterday’s closing price.
The German firm had tried late last year to do an initial public offer for its concessions unit in a bid to raise €1 billion. But last year’s “Dubai crisis” and its impact on world markets ultimately derailed Hochtief’s efforts.