Atlantia could increase its offer price for Abertis up to €18/share.
Atlantia could increase its offer price for Abertis up to €18/share.
According to Cinco Días, Atlantia could increase its offer price for Abertis up to €18/share in the event of a competing bid. Cinco Dias
Positive for Abertis
This news is in line with our opinion, that Atlantia will be the highest bidder thanks to its size and unlikely synergies. Although we value Abertis at €15.7/share, the €18/share valuation mentioned by Cinco Días is not unreasonable for a sector player.
Our valuation pivots around a DCF model using a 5.8% weighted average discount rate, representing a spread of 400bp vs. the current weighted average sovereign bonds yield (1.8%) in the countries where the company is present (Spain, France, Italy, Brazil, Chile, Puerto Rico and Argentina).
The acquisition of brownfield projects is proving to be demanding in terms of IRRs asked by the sellers (excess of liquidity, low financing cost, extraordinary low sovereign bond yield make it a sellers’ market), and therefore Atlantia may well pay above our estimated valuation.
We reiterate our Hold recommendation.
Positive for ACS
This news could dissuade ACS to launch a competing bid for Abertis, something that should have a positive impact on ACS’ stock price. We reiterate that ACS would not obtain any synergies from Abertis and therefore it would have a negative impact on our valuation of ACS if it pays more than €15.7/share. We maintain our Hold recommendation.
Abertis Infraestructuras is the parent company of a group of companies engaged in the management of mobility and communications infrastructures operating in five sectors: motorway concessions, telecommunications, airports, car parks and logistics services. Its business purposes include the construction, maintenance and operation of motorways under concession in Spain and internationally; the construction of roads; ancillary construction activities, maintenance and operation of motorways, and communications and/or telecommunications for the mobility and transport of people, goods and information, under the necessary authorization, as the case may be.
Bankinter S.A. is a Spanish brokerage firm established in 1989. The company's line of business includes the provision of market research and trading services for Equity and Fixed Income products.
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