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Goldman to Buy RCO Tollway Stake as ICA Seeks Cash

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June 20 (Bloomberg) -- Empresas ICA SAB, Mexico’s largest construction company, will sell its minority stake in a Mexican tollway operator to partner Goldman Sachs Group Inc. and use the proceeds to pay short-term debt.

The Mexico City-based builder said it expected to receive 5.07 billion pesos ($380 million) from the sale of its 18.7 percent stake in Red de Carreteras de Occidente, which is majority-owned by Goldman Sachs. The deal needs approval by Mexico’s antitrust regulator and the Ministry of Communications and Transportation, ICA said in an e-mailed statement today.

ICA shares have tumbled more than 30 percent since May 16, the day before Moody’s Investors Service downgraded the company’s credit rating citing its high leverage and delays in public-works spending by President Enrique Pena Nieto. The company’s sales dropped 27 percent in the first quarter while debt climbed 14 percent to 54.2 billion pesos from its Dec. 31 level.

“We are significantly strengthening our financial position,” ICA Chief Executive Officer Alonso Quintana said in the statement. “The sale of ICA’s investment in RCO is a clear example of our strategy of selective recycling of capital in our asset portfolio and creating value for ICA’s shareholders.”

ICA fell 2.8 percent to 21.28 pesos at 9:18 a.m. in Mexico City as Mexico’s benchmark IPC index dropped 2.5 percent.

To contact the reporter on this story: Brendan Case in Mexico City at bcase4@bloomberg.net

To contact the editor responsible for this story: Ed Dufner at edufner@bloomberg.net