Brisa-Auto Estradas de Portugal SA’s third-largest investor is holding off on tendering stock, potentially undercutting an effort by the two bigger shareholders to buy full control of the toll-road operator.
The 2.76 euro-a-share offer from the Tagus Holdings Sarl venture of family-owned holding company Jose de Mello SGPS SA and London-based Arcus Infrastructure Partners LLP’s Aeif Apollo unit expires tomorrow. Analysts including Elodie Rall at JPMorgan Chase & Co. predict most minority investors will accept, and eight funds with about 140 million euros ($174 million) in Portuguese assets disposed of a combined 7 percent stake in July, according to the country’s securities regulator.
“I plan to sell all of my shares in Brisa,” Pedro Pintassilgo, a fund manager at F&C Management Ltd. in Lisbon said in a telephone interview yesterday. “I believe that the Tagus bid will have a very high level of success.”
The Tagus partners already own a 49.6 percent equity stake and 53.8 percent of the voting rights in Brisa. The Portuguese highway operator’s Spanish counterpart, Abertis Infraestructuras SA (ABE), is the third-ranked investor with 16 percent of votes. The Tagus bid values Brisa, which is based in the Lisbon suburb of Sao Domingos de Rana, at 1.66 billion euros.
Abertis, which criticized Tagus’s initial offer in March of 2.66 euros a share as inadequate, has declined to comment since the bid was raised 3.8 percent in mid-July. A spokeswoman at the Barcelona-based toll-road operator said today that Abertis hadn’t yet decided on whether to accept the bid and would announce any move on the last day of the offer.
As a deepening recession in Portugal continues to weigh on Brisa’s toll-road revenue, Credit Suisse AG said on July 31 that the revised Tagus offer is an opportunity for investors to exit the stock.
“Investors should accept the offer as it is approximately in line with our target price,” Robert Crimes, a London-based analyst, said in the Credit Suisse research report. Crimes cut his share-price estimate for Brisa to 2.50 euros from 2.60 euros after the company said first-half income dropped 44 percent from a year earlier to 31.9 million euros.
Abertis’s acceptance will be crucial for Tagus to obtain the 90 percent voting control of Brisa that would enable the owners to de-list the toll-road company under Portuguese market rules. Tagus said on July 16 that once the results of its offer are determined, it may request removal of Brisa shares from trading. The venture doesn’t have a target holding because the partners already hold majority control of Brisa, Jose de Mello SGPS Chairman Vasco de Mello told journalists on March 29.
Results of the tender are scheduled to be announced at 5 p.m. Aug. 9, said Paula Cordeiro, a spokeswoman for the NYSE Euronext Lisbon exchange.
“Abertis is an industrial group with strong shareholders, a good balance sheet and a beautiful mergers and acquisitions record,” said Myriam Cohen, an analyst at Alphavalue in Paris. “They have the capacity to resist the offer at this price.” At the same time, Abertis is “also in a reshuffling phase of assets, and they may not want to manage a minority stake.”
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