UPDATE 4-Bidders strive to keep Abertis at investment grade

* Sale of Atlantia, Brisa stakes just one option

* Consortium wants to keep Abertis debt investment grade

* Abertis shares down 1.8 pct

(Reacasts, adds background on Intoll, updates shares)

By Jonathan Gleave and Greg Roumeliotis

MADRID/AMSTERDAM, July 15 (BestGrowthStock) – A consortium looking
to acquire Spanish motorway operator Abertis (ABE.MC: ) in a
leveraged buyout worth at least 25 billion euros ($32 billion)
said it was trying to uphold the company’s credit status.
Earlier on Thursday, a source close to the bidding group
said it hoped to sell stakes held by Abertis in two highway
operators, Italy’s Atlantia (ATL.MI: ) and Portugal’s Brisa
(BRI.LS: ), that could lead to a special dividend of up to 1.2
billion euros and would help finance the acquisition.

“The consortium is looking at a refocusing of the group and
several structures to finance the bid are being looked at, but
it has not been decided which assets will be sold, if any,” said
the consortium, which includes Abertis’s core shareholders —
ACS (ACS.MC: ) and Criteria (CRIT.MC: ) — and private equity firm
CVC Capital Partners.

Abertis, which also runs airports, telecoms and car parks
and has a 32 percent stake in French group Eutelsat (ETL.PA: ),
has 14.6 percent of Brisa and 6.7 percent of Atlantia — stakes
which analysts have previously tipped as likely disposal
candidates to fund the takeover.

Shares in Atlantia were down 3.1 percent at 1227 GMT after
an industry source said Italy’s Benetton family is not
interested in buying Abertis’s Atlantia stake [ID:nWEA9673]
Shares in Abertis, which has net debt of 14.5 billion euros,
were down 1.84 percent, while Brisa shares were up 0.2 percent.

For a calculator on how much cash the Spanish motorway group’s
core shareholders can extract while retaining control:

Toll roads can be attractive assets because of their stable,
long-term cash flows, though traffic on the motorways is often
sensitive to wider economic growth.

Shares in Spanish peer Ferrovial (FER1.MC: ) shot up as much
as 10 percent on Thursday after Canada Pension Plan Investment
Board put in a $3.4 billion bid for Australia’s Intoll Group
(ITO.AX: ).

Ferrovial has put a 10 percent stake in Canada’s 407-ETR
motorway up for sale, the same motorway in which Intoll has a 30
percent interest. [ID:nSGE66E00R]


The consortium said it was trying to put together a
financing plan that would keep Abertis’s debt at investment
grade after the takeover. It confirmed it was in the process of
raising a 5.3 billion euro loan to back its bid.

Banking sources told Reuters last week lenders were assuming
a BB rating for Abertis, which is currently rated BBB+ by S&P
and A- by Fitch. [ID:nLDE66816I]

CVC, ACS and La Caixa’s Criteria plan to put debt and equity
into an investment vehicle which will launch a takeover of
Abertis. A consortium source said on Thursday CVC was looking to
put in at least 1 billion euros in equity for the bid.

“If you have just 5.3 billion euros of debt, you are either
going to have to put some more equity or lower the offer price,”
an analyst at a leading European bank said.

ACS could use the takeover process to raise the 2 billion
euros it needs to realise its ambition of raising its 12 percent
stake in Spanish utility Iberdrola (IBE.MC: ) to more than 20

“We do not see a squeeze-out of minority shareholders,
though one cannot tell for sure how many will tender their
shares. We envisage a possibility of the free float in Abertis
being between 0 and 12 percent post-acquisition,” the consortium

Spanish infrastructure deals, like ACS’s sale of its Spanish
Ports and the divestment of Endesa’s (ELE.MC: ) Spanish gas grid,
have run up against a reluctance among some banks to provide
credit approval during Spain’s financial downturn.

ACS told Spanish stock market regulators last week it had
lent French bank Societe Generale (SOGC.PA: ) a 3 percent stake in
Abertis, cutting its direct stake to 22.8 percent from 25.8
percent. Criteria owns a 28.5 percent stake in Abertis.

(Editing by David Cowell)
($1=.7869 Euro)

UPDATE 4-Bidders strive to keep Abertis at investment grade