ACS stockholders back share issue for Hochtief deal
Shareholders in Spain's largest construction group ACS on Friday approved a capital increase as part of its plan to take control of German rival Hochtief, the group said.
ACS, which already holds just under 30 percent of Hochtief, Germany's largest public works group, wants to take a controlling stake through an all-share swap to create what would be one of the world's leading building firms.
However, the Spanish company has offered a price below Hochtief's current market value, which Hochtief says does not represent a fair deal for the group.
The German firm is trying to force ACS to make a bid for Hochtief's Australian subsidiary Leighton, thereby increasing the price -- and possibly discouraging the Spanish firm.
ACS said shareholders approved the capital increase of 78.5 million euros (108 million dollars) so as to give it some flexibility in the deal and the new shares may not be needed.
"The proposed share capital increase, which will have a maximum volume of up to virtually 50 percent of the existing share capital, has the objective of increasing ACS's flexibility to carry out the voluntary takeover bid we have made for Hochtief," ACS chairman Florentino Perez told the shareholders' meeting.
"I should add that if everything related with this bid proceeds as expected, we will not need to issue new shares and therefore there will be no need to issue the shares considered in this capital increase."
Germany's financial supervisory authority Bafin last month extended the deadline for the takeover bid by four weeks in order for ACS approve the capital increase.
The Spanish group formally presented its offer to Bafin on November 11. Bafin has 15 days to rule on the bid and Hochtief shareholders then have a further four weeks to decide whether to accept the offer.
© 2010 AFP