SPAIN: Hungarian consortium Ganz-Mavag Europe has put forward a €619m offer to buy 100% of Talgo, which said the offer was attractive. However, the Spanish government is not keen to see the company in foreign ownership, and options including a potential takeover by CAF are reportedly being explored.
The €5 per share offer to buy 100% of Talgo was submitted to Spain’s National Securities Market Commission (CNMV) on March 7.
EU rules mean that Spain cannot prevent a takeover, but Transport Minister Óscar Puente had said on March 5 that the government would do everything possible to prevent it.
The government does not want to see foreign ownership of the leading manufacturer of high speed trains for Spain, which has a growing export business. Reference has also been made to the Hungarian government’s pro-Russian leanings.
The Ganz-Mavag Europe consortium includes rolling stock manufacturer Magyar Vagon (55%) and Hungarian state-owned investment fund Corvinus (45%).
In 2022 Magyar Vagon became 100% owner of the Dunakeszi Járműjavító coach factory by acquiring the 50% stake in the TMH Hungary Invest joint venture previously held by Russia’s Transmashholding.
On March 8 RENFE Operadora added a further complication by announcing that it would penalise Talgo €166m because of the latest delays in handing over the first Class 106 Avril high speed trains. These were ordered in 2016 for €1·5bn and should have been handed over by January 2021.
The penalty would increase by €80 000 per day should the trains not be handed over by April 1.
On March 8 Talgo’s share price fell 4% to €4·2.
The possibility of a takeover of Talgo has been bandied about for some years, with 40% owner Trilantic looking to divest its stake. The remainder of the company is in the hands of numerous smaller investors.
During the first nine months of 2023 Talgo reported income of €470m, 34% more than during the same period in 2022. EBITDA had increased by 68% to €65m, while the order book was at an all-time record of €4·2bn.
Basque political party EAJ-PNV, which is keen to see the region’s industries strengthen their market presence, has hinted that CAF could be interested in a rival offer.
CAF had an opportunity to make an offer in 2021, when Talgo’s stock market value was under €400m. But with Magyar Vagon now bidding a minimum of €617m, CAF will have to offer considerably more to seal the acquisition.
One difficulty is that almost 25% of CAF’s shares are held by its employees, and it would have to increase its share capital considerably to undertake a public takeover offer. Its principal financier and second largest shareholder is Kutzabank, with a 14% stake.
