Slim Launches €2,800M Takeover Of FCC

7 March 2016 – Expansión

On Friday, the Mexican tycoon Carlos Slim (pictured above) announced a takeover bid for 100% of FCC, after taking ownership of 36.5% of its share capital. Slim is proposing a cash offer at €7.60 per share. This price represents a premium of 15.3% with respect to Friday’s closing price of €6.59. The company has 260.5 million shares in circulation. Together with the other 118 million shares that the company is issuing through its current capital increase, Slim’s offer values the group at €2,870 million.

Slim is launching the takeover after exceeding the 30% threshold set by Spanish legislation for mandatory takeovers. On Friday, Slim explained to Spain’s National Securities Market Commission (CNMV) that it, directly or indirectly, controls 29.558% of the voting rights through Control Empresarial de Capitales (CEC), a subsidiary of Inversora Carso (IC), plus it has been “attributed” another 7.036% of the share capital. According to financial sources, this latter percentage comes from the pledge made in relation to the loans granted to Esther Koplowitz, FCC’s other major shareholder.


The possibility of the FCC takeover has been on the cards since Slim agreed to refinance FCC, but until now it was unclear how he was going to be able to exceed the share capital threshold of 30%, beyond which level the obligation to undertake the operation is legally activated.

Slim acknowledges that “IC is obliged to make a public offer for the acquisition of all of FCC’s shares and to address that offer to all of the shareholders at a fair price”. Slim’s takeover of FCC’s capital requires the sudden takeover of Portland, the cement subsidiary of the construction and services group.

As a result, Slim announced another takeover on Friday, in this case of Portland, in parallel to the takeover of FCC. It will be launched by FCC itself and will involve the group delisting from the stock exchange.

The takeover of Portland, also in cash, will be made at €6 per share, which represents a premium of 14% above the closing price on Friday (€5.26) and 12% above the price on Thursday. At that price, Portland is worth around €310 million, compared with €272 million based on its list price on Friday.

FCC already controls 77.94% of Portland, which means that the takeover is targetted at 22% of the share capital. Following the takeover, Portland will no longer be listed on the stock market. Investors that do not participate will lose out in terms of the liquidity of their shares. Although Slim is offering a premium for his takeover of FCC, the price still falls below the price at which he purchased his shares (€9.75), which means that it will only partially offset the excess over book value at which his stake is recorded.

Original story: Expansión (by C.Morán and M.Á.Patiño)

Translation: Carmel Drake

Blackstone & Apollo Buy Portland’s Debt & Put Pressure on FCC

4/09/2014 – El Confidencial

While giving the finishing touch to the stand by of her €1 billion personal debt, Esther Koplowitz has to face another challenge. GSO (vulture fund of Blackstone) and Apollo have acquired a half of the debt of Portland Valderribas, cement manufacturer belonging to the busineswomans FCC (77.9% stake) which is also in default until September 30th.

The two opportunistic funds have taken advantage of a decision taken by the lenders of Portland and bought €500 million in loans. GSO and Apollo strive at becoming the new main creditors of FCCs cement producer whose managers will now have to negotiate with the distress funds to prolong a global redemption of €1.277 million.

BBVA agreed to wait more for the payment on condition that FCC would maintain relatively positive results. The company failed to do so. 75% of Portlands debt obtained a permission to be paid-off by the end of September. However, on the return from holidays, Mrs Koplowitz found out that now she has to negotiate with two vulture funds.

Surprisingly, Blackstone had already been one of the lenders of Portland before the purchase. In 2012, the fund agreed to finance Giant, U.S. arm of the cement manufacturer, with €350 million in high risk bonds at a 10% interest rate.

As a consequence, the future of Portland rested in hands of Blackstone and that outraged FCC. Its directors believed that by the time the final solution for the parent company and the family debt is found, a way to solve the problem with Portland will come up. The firms working capital is drowning in the red (a €817 million debt) in spite of fierce cuts in the number of manufactures and employees.


Original article: El Confidencial (by Agustín Marco)

Tanslation: AURA REE