FRANKFURT, Oct 30 (Reuters) - Spanish builder ACS would be willing to guarantee in writing the independence of Hochtief and its Australian unit Leighton as part of a takeover, the chairman and chief executive of ACS said in an interview with a German newspaper.
Best known internationally as president of football club Real Madrid, Florentino Perez wooed the managements of Hochtief and Leighton hostile to his all-share takeover bid due to be filed in November.
'Hochtief should remain German, Leighton Australian, Turner and Flatiron American. We want to work together with Hochtief in the same way that Hochtief does with Leighton to this day,' Perez said in an interview to be published in Welt am Sonntag.
Hochtief owns about 54 percent of Leighton, which remains a listed company in Australia - something Perez reaffirms he will do in the case of Hochtief.
'We are speaking here of entrepreneurial independence within a large global group of affiliates. (...) We can also guarantee that in writing in an Investor Agreement,' Perez said, adding that Hochtief CEO Herbert Luetkestratkoetter knew ACS was willing to discuss such a contract.
Perez said he expected next month to file the bid, which valued the remaining 70 percent of Hochtief at about 2.7 billion euros when first publicised.
'We will submit the bid in November and expect the final whistle in November presumably at the end of January,' he said.
Perez told the paper he went back on his word last year not to raise the 30 percent stake ACS holds in Hochtief after credit conditions deteriorated following the global financial meltdown.
The CEO of ACS, which has total net debt of 9.08 billion euros ($12.6 billion), argued that taking control of just over 50 percent of Hochtief would create an unbeatable alliance when it comes to bidding for huge infrastructure projects.
'Governments no longer have the necessary funding for large infrastructure projects. Partnerships with private construction companies are therefore compulsory,' he said.
ASSETS SECURE DEBT
'We have to provide the financing for these projects ourselves in advance so the financial strength of a company is pivotal.' Perez said the balance sheet of ACS was not in disorder even though it would take ACS nearly five years at its current pace to redeem the net debt pile were it to use its entire annual cash earnings.
'There is nothing bad when taking out a loan to buy a house, since there is an asset, the house, which serves as collateral. Half of our 9 billion in debt is secured by stakes in Spanish energy group Iberdrola, toll road operator Abertis and Hochtief,' Perez said.
'The other half are projects currently running and investments in our day-to-day operations,' he said. As a result, workers should not be afraid ACS will split up the group and sell off its individual parts to raise cash.
'Our company started out with 70 employees and 5 million pesetas, or 30,000 euros, in sales in 1983. Today we generate 16 billion euros in revenue and employ 146,000 people with another 46,000 temporary workers,' he said.
'ACS is a growth story. We are a machine that creates jobs.'
(Reporting by Christiaan Hetzner; editing by Sue Thomas) Keywords: HOCHTIEF/ACS
COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Best known internationally as president of football club Real Madrid, Florentino Perez wooed the managements of Hochtief and Leighton hostile to his all-share takeover bid due to be filed in November.
'Hochtief should remain German, Leighton Australian, Turner and Flatiron American. We want to work together with Hochtief in the same way that Hochtief does with Leighton to this day,' Perez said in an interview to be published in Welt am Sonntag.
Hochtief owns about 54 percent of Leighton, which remains a listed company in Australia - something Perez reaffirms he will do in the case of Hochtief.
'We are speaking here of entrepreneurial independence within a large global group of affiliates. (...) We can also guarantee that in writing in an Investor Agreement,' Perez said, adding that Hochtief CEO Herbert Luetkestratkoetter knew ACS was willing to discuss such a contract.
Perez said he expected next month to file the bid, which valued the remaining 70 percent of Hochtief at about 2.7 billion euros when first publicised.
'We will submit the bid in November and expect the final whistle in November presumably at the end of January,' he said.
Perez told the paper he went back on his word last year not to raise the 30 percent stake ACS holds in Hochtief after credit conditions deteriorated following the global financial meltdown.
The CEO of ACS, which has total net debt of 9.08 billion euros ($12.6 billion), argued that taking control of just over 50 percent of Hochtief would create an unbeatable alliance when it comes to bidding for huge infrastructure projects.
'Governments no longer have the necessary funding for large infrastructure projects. Partnerships with private construction companies are therefore compulsory,' he said.
ASSETS SECURE DEBT
'We have to provide the financing for these projects ourselves in advance so the financial strength of a company is pivotal.' Perez said the balance sheet of ACS was not in disorder even though it would take ACS nearly five years at its current pace to redeem the net debt pile were it to use its entire annual cash earnings.
'There is nothing bad when taking out a loan to buy a house, since there is an asset, the house, which serves as collateral. Half of our 9 billion in debt is secured by stakes in Spanish energy group Iberdrola, toll road operator Abertis and Hochtief,' Perez said.
'The other half are projects currently running and investments in our day-to-day operations,' he said. As a result, workers should not be afraid ACS will split up the group and sell off its individual parts to raise cash.
'Our company started out with 70 employees and 5 million pesetas, or 30,000 euros, in sales in 1983. Today we generate 16 billion euros in revenue and employ 146,000 people with another 46,000 temporary workers,' he said.
'ACS is a growth story. We are a machine that creates jobs.'
(Reporting by Christiaan Hetzner; editing by Sue Thomas) Keywords: HOCHTIEF/ACS
COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.