* Atlantia considers legal action after Madrid ministers
* New all-cash bid among options under review
* Financing package granted with fixed terms until deal
* Regulatory review may cause further delay
(Adds comment from Atlantia spokesman)
By Pamela Barbaglia and Ben Martin
LONDON, Dec 12 (Reuters) - Italy's largest motorway operator
Atlantia is examining legal action to stay in the $20
billion bidding war for Spanish rival Abertis amid
concerns it will be frozen out of the contest, a source familiar
with the matter told Reuters.
The move comes after two Spanish ministers asked the CNMV,
the country's stock markets and merger deals regulator, to
revoke the approval it granted in October for Atlantia's bid,
which has also been cleared by the EU's competition regulators.
If successful, a merger of Atlantia and Abertis would create
the world's biggest toll road operator with a combined market
value of more than 40 billion euros ($46.89 billion).
However, due to the political hostility in Madrid the odds
are lengthening that the Rome-based company will prevail over
German bidder Hochtief, which is controlled by Spanish
construction group ACS.
Atlantia is now preparing for legal action should its bid be
blocked, the source said.
The Rome-based firm, controlled by the Benetton family, is
fully focused on winning control of Abertis, regardless of the
opposition from Spanish public works minister Inigo de la Serna
and energy minister Alvaro Nadal, he added.
"Those ministers have previously voiced discontent but the
rest of the government is neutral," he said. "This is a
financial transaction and only the market will decide."
A spokesperson for Atlantia said "the position of Atlantia
was stated in our press release of December 7, which reflects
our belief that the matter under discussion can be resolved
constructively through engagement with all the relevant Spanish
Spain's infrastructure and energy ministries told the CNMV
on Dec. 7 it should not have authorised the bid as Atlantia had
not sought permission from the government to take control of
Abertis's communication satellites business.
The government considers Hispasat, majority-owned by
Abertis, as a strategic asset since it controls Spain's national
satellite communications system.
The uncertainty surrounding the CNMV's decision, which is
due by Jan. 7, is keeping Atlantia's management on tenterhooks
as it wants to submit a higher bid in January.
Atlantia needs to trump a 17.1 billion euro counter-bid from
Hochtief, which was submitted on Oct. 18.
Should CNMV apply different rules to the Hochtief bid and
only require Atlantia to get government permission to bid for
Abertis, then the Italian firm would seek the intervention of
the European Commission on the grounds of alleged
Atlantia has already negotiated a financing package with a
pool of banks which include Credit Suisse, Mediobanca
, Santander, UniCredit and Intesa
, the source said, adding that the terms of the package
are guaranteed until a deal has been agreed.
The Italian firm, led by boss Giovanni Castellucci, is now
considering making an all-cash bid, the source and another
person close to the negotiations said, adding this is the
easiest option as banks are willing to lend more cash.
Reuters reported on Dec. 6 that Atlantia was likely to wait
to call any new bid its "best and final" offer until the last
five days of an investors' acceptance period, which will start
immediately after the regulatory review and will last 30 days.
This is when the Spanish regulator will ask Atlantia and
Hochtief to submit their final offers in sealed bids. Their
proposals will be presented to Abertis's board for a final
Yet both parties now face a delay due to the impending CNMV
ruling on Atlantia.
Under Spanish law the two ministers who raised concerns over
Atlantia's takeover plan may still appeal against any decision
which clears the way for the Italian bid to go ahead, the source
But the acceptance period for both Hochtief and Atlantia can
only open when both bids have been cleared by the regulators.
And any appeal by either side would cause further delay to a
process which has been running since May and has mobilised an
army of bankers and lawyers.
DLA Piper and Italy's Gianni, Origoni, Grippo, Cappelli &
Partners are among Atlantia's legal advisers while Credit
Suisse, Mediobanca and Santander are its main banks.
Freshfields and Linklaters are advising ACS and Hochtief on
legal matters alongside a pool of investment banks led by
JPMorgan and Lazard.
Abertis has retained Citi and boutique bank AZ Capital while
Spanish law firm Uría Menéndez Abogados is its legal adviser.
($1 = 0.8531 euros)
(Additional reporting by Paola Arosio and Andres Gonzalez;
Editing by Greg Mahlich and James Dalgleish)
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