The largest shareholder in Spanish construction group FCC may offer Mexican billionaire Carlos Slim the right to buy the shares that would have been allocated to her as part of a $1.3bn rights issue.
If an agreement can be reached, and Slim decides to buy the maximum number of shares allowed, he would own about a quarter of the firm.
The shareholder in question is Esther Alcocer Koplowitz (pictured), who is also the chair of FCC, the daughter of its founder and a billionaire who holds a stake of 53.8% in the group. She had been in talks to sell the rights to financier George Soros, but the negotiations broke down.
The aim of the rights issue is to reduce FCC’s debts, which presently stand at about $8bn. Koplowitz operates through an investment firm called B-1998. However, this has debts of about $1.1bn, which it is trying to restructure.
Shareholders in FCC approved the rights issue at an extraordinary general meeting in Barcelona on 20 November. However, Reuters reported a source close to the negotiations who said it would not go ahead until Koplowitz found a buyer for her shares. "Placing one billion euros in the market is not the same as having 500 million euros already assured," the source said.
In her presentation to shareholders at the meeting, Koplowitz, said: "Our strategic objective is to create value for shareholders while addressing the challenge of making the group more profitable, robust and efficient."
Juan Béjar, the chief executive of FCC, told shareholders that the restructuring would make FCC "an attractive business prospect for national and international investors". He said the contractor would has "a solid portfolio and positive growth outlook, focused on high-value business, with a management team dedicated to results and to all shareholders".
FCC has responded to pressure from its creditors to sell non-core assets, lay off staff and restructure borrowings to pare down its balance sheet.
As with other Spanish contractors, it suffered from the 2008 property crash, which left it with debts on which the interest to be paid was between 11% and 16%.
Without a deal between Koplowitz’s investment vehicle and Slim’s Inmobiliaria Carso there could be delays to the company’s refinancing deal, which will includes a loss of $170m for creditor banks.
FCC did not pay a dividend to shareholders this year, and reported a net loss of $840m in the first nine months of 2013. Analysts expect the company to earn about $56m this year. The firm, which employs about 90,000 people, specialises in civil engineering.
