Blackstone not interested in La Seda - source

19 March 2008 21:02  [Source: ICIS news]

LONDON (ICIS news)--Blackstone has rejected reports that it was  interested in buying a 12% stake in Spanish polyethylene terephthalate (PET) maker La Seda de Barcelona (LSB), according to a source close to the UK buyout group.

“As far as I know, this was never considered and was pure speculation from the Spanish press,” said a source close to Blackstone.

Spain’s capital markets have speculated that Blackstone would buy the stake to profit from LSB’s collapsing share price, which has fallen 37% so far this year.

The decline has been driven by concerns that LSB has over-hedged itself by making a slew of acquisitions to become Europe’s largest PET maker.

Based on the company’s current market cap of €702m ($1.1bn), the stake would have been worth €84m.

Barcelona-based LSB would not comment.

LSB cancelled a €595m bid to buy a plastic-chemicals subsidiary from compatriot Petrochemicals firm Cepsa in early February after analysts said a planned €500m share offering to finance the deal would further dilute LSB's value.

LSB said it would instead concentrate on generating value from its other acquisitions.

Despite its problems, some analysts are confident that LSB’s industrial plan is on the money.

Spanish broker Banesto said this week the recent acquisitions will generate synergies and cut LSB’s transportation and raw-material costs. It said LSB’s shares could rise to €1.87 in the next 12 months, up from €1.07 now.

($1 = €0.64)

By: Ivan Castano Freeman
+44 20 8652 3214

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