Spanish builder ACS makes a $3.5bn stock bid for German rival Hochtief

SPANISH builder ACS plans a lowball bid for German counterpart Hochtief in a move aimed at securing funds to reduce debt and buy a bigger stake in power group Iberdrola.

ACS, which already owns 29.9 per cent of the largest German building company Hochtief, announced plans for the nil-premium offer yesterdfay.

ACS is bound by German takeover law to make an offer for the whole company once it has crossed the 30 per cent threshold.

With a low bid, ACS expects rejection, but will then be allowed to increase its stake incrementally without paying a premium.

ACS confirmed that a stake of just over 50 per cent is its target. Analysts said that would
allow it to consolidate the cashflows of Leighton Holdings, which make up 82 per cent of
Hochtief’s first-half pre-tax profit, into its balance sheet.

“Hochtief’s main charm is Leighton Holdings and this is definitely also appealing to ACS, and other companies for that matter,” analyst Heino Ruland of Ruland Research said.

ACS, is headed Florentino Perez.