Spain’s Union Fenosa shareholder buys stake in Iberdrola
ACS, the main shareholder in Spanish power supplier Union Fenosa, has purchased a stake in the equity capital of Iberdrola, the construction firm confirmed on Wednesday.
ACS bought a 6.31% holding in third-ranking power generator Iberdrola, but did not want to be drawn on any merger plans between Iberdrola and Union Fenosa, in which it holds a 35% stake. The announcement comes just one day after another Spanish construction group, Acciona, unexpectedly entered into power major Endesa’s ownership, and has sent a buzz through the market. Iberdrola’s shares have risen by more than 12% to EUR 37.40/share, as stockbrokers rushed to take up positions.
ACS paid EUR 37.00/share in Iberdrola, spending EUR 2.1 billion in total on the deal, according to data given to the bourse regulator CNMV. Although ACS said in a statement it would only decide whether to increase the 6.21% stake “in view of the circumstances,” it has asked for permission to buy 10% in Iberdrola. That is the limit that any company may buy in a power generator without asking for permission from energy regulator CNE.
ACS’ dismissal of rumours it plans a merger between second- and third-ranking power generators Iberdrola and Union Fenosa were falling on deaf ears on Wednesday (Gas Natural’s failed bid for first-ranking Endesa has left the power market in turmoil, and as Iberdrola now looks unlikely to buy divested Endesa assets, it could be on the look-out for other growth opportunities, analysts said. Iberdrola said it welcomed ACS’ presence, adding the construction firm was not speculating, but would become a permanent shareholder.
Unconfirmed reports in the Spanish press claim ACS president Florentino Perez has met with prime minister Jose Luis Zapatero to discuss creating a “national champion” in the power sector, after Endesa has been left vulnerable by the ongoing takeover battle (see separate story).
If ACS actually increases its stake in Iberdrola to 10%, it would become the main shareholder in the group, over the banks Chase Nominees (8.359%), State Street Bank and Trust (5.929%), BBVA (5.46%) and Bilbao Bizkaia Kutxa (5.01%). A merger between Iberdrola and Union Fenosa would make the resulting group the biggest player in the Spanish power market, with a stock market value of more than EUR 42.5 billion, according to Spanish paper El Pais. IS
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