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Investing.com -- Eiffage SA on Thursday agreed to purchase an additional 7.11% stake in Getlink, increasing its ownership to 27.66% of capital and 29.90% of voting rights.
The French construction and concessions company will acquire approximately 39.1 million shares for €692 million, equivalent to €17.70 per share. This represents a premium of about 14% above Getlink’s previous closing price of €15.49.
Eiffage will finance the transaction using its existing cash facilities. The deal includes a provision that if Eiffage sells shares or acquires new ones at a higher price within 18 months, the price difference per share would be paid to the seller, adjusted for dividends.
This acquisition aligns with Eiffage’s previously stated strategy of increasing its ownership in Getlink up to 30%. The company has been steadily building its position, having acquired an additional 1.76% shareholding in October 2023 at €14.80 per share.
Despite the increased stake, Eiffage has stated it does not intend to make a public offer for the remaining shares of Getlink, though it will remain opportunistic regarding its investment.
Jefferies analysts expect a negative reaction for Eiffage shares due to the premium paid, which is approximately 20% above its last major stake purchase. The timing of the investment comes amid a soft macroeconomic backdrop in both the UK and France, and ahead of Getlink’s rising capital expenditure cycle.
Conversely, Getlink shares are expected to react positively as investors reconsider potential further consolidation possibilities.
Eiffage shares are currently trading at €112.20, with Jefferies maintaining a buy rating and a price target of €130.00, representing a 16% upside potential.
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