The stock market gave a big thumbs up to the proposed merger between Italy and Spain's leading motorways companies with Autostrade SpA opening here on Monday with an almost 10-point gain.
In Madrid, trading of Abertis stock was delayed but when it was allowed on the market it immediately jumped 1%. Abertis' leading stockholders also did well with construction giant ACS leaping 2.32%.
The proposed merger had a similar effect here and the motorways services company Autogrill, which like Autostrade has the Benetton family as its the biggest stockholder, jumped 3.9%. Autostrade and Abertis agreed at the weekend to work towards a one-on-one merger believed to be worth some 15 billion euros.
The merger will create the world's biggest toll-road operator with networks in Europe as well as in North and South America.
According to the terms of the agreement, Abertis would absorb Autostrade. The single company would make Barcelona its headquarters, for tax reasons, and Abertis CEO Salvador Alemany Mas would head the new Italo-Spanish group. Both companies are more or less the same size and until September 2004 Autostrade held a close to 5% stake in the Spanish company.
Once merged, in the latter half of this year, the Italo-Spanish group hopes to maintain its 'A' rating with Standard & Poor's with a debt at 4.7% of EBITDA (earnings before interest, tax, depreciation and amortization). The merger plan also plans to up the group's annual dividend by 5% and already this year Autostrade will be paying out a special dividend of 3.75 euro a share.
