Spanish builder ACS seeks majority stake in German target
Spain's largest construction group ACS said Monday it wanted to take a majority stake -- but not 100-percent control -- of German takeover target Hochtief.
"We stress that we are seeking a form of cooperation that benefits both companies," chief executive Angel Garcia Altozano said in a statement released after ACS had presented its offer to Hochtief board members.
Later in the day, Hochtief will hold an extraordinary board meeting to discuss the offer.
The Spanish company launched a takeover bid September 16, offering eight ACS shares for five of Hochtief's, Germany's largest public works group. The German firm has rejected the offer as being too low.
ACS confirmed that it intends to increase its stake in Hochtief so that it can consolidate the German company's results in its accounts.
The Spanish company "does not seek total control," the statement said.
Under the ACS scheme, Hochtief would continue to be listed in the Frankfurt market with a large number of shares in free float and with its headquarters in Essen, it said.
The German firm also would maintain its prestige trademarks such as Hochtief, Leighton, Turner and Flatiron in various parts of the world.
In addition, ACS was commited to respecting a co-determination agreement and collective agreements. The benefits of cooperation between the groups would increase because of their geographic fit and economies of scale, ACS said.
Together, ACS and Hochtief would be the largest construction group in Europe in terms of revenue, eclipsing French groups Vinci and Bouygues. ACS brought in 15.6 billion euros in 2009 and Hochtief 18.17 billion euros.
According to the ACS timetable, the takeover offer will be formally launched about November 2 and Hochtief will have until November 30 to respond. ACS aims to own at least 50.07 percent of Hochtief.
Under German law, the Spanish group was obliged to make an offer for all the shares because its stake had grown to 30 percent.
© 2010 AFP