OHL Bonds Surge on Positive Read-Across From Aldesa’s Buyout
2020-01-09 11:20:37.683 GMT

By Irene García Pérez
(Bloomberg) — Obrascon Huarte Lain SA’s notes rose
sharply, extending a rally from last month, as the buyout of
peer Aldesa by a Chinese firm fueled investors’ optimism for a
capital injection.
The Spanish construction company’s 270 million euro ($300
million) of bonds due in March 2023 rose almost 4 cents on the
euro to 79 cents, the highest since November 2018, according to
data compiled by Bloomberg. It’s also the biggest move since
Oct. 22, after it emerged Mexico’s Amodio family was in talks to
acquire a stake in OHL. The 323 million euro senior unsecured
notes due in April 2022 were also up 3 cents to 80 cents.
“The rise is most likely primarily due to a delayed
reaction to the Chinese investment into competitor Aldesa,”
Arndt Muthreich, managing director of credit research at Stifel
Nicolaus, said in an email.
China Railway Construction subsidiary agreed to buy a 75%
stake of Aldesa and inject about 250 million euros into the
company, according to a Dec. 27 statement.
OHL itself got offers from Chinese bidders in the past, one
from HNA in 2016 an another one from China State Construction
Engineering in 2017, but both fell apart. Villar Mir, the
company’s biggest shareholder, and OHL are currently in talks
with the Amodio family for a capital increase.
“Although the deal with the Amodio family, when and if it
materializes, won’t be as transformative for OHL as the CRCC
deal is for Aldesa, it will be positive for OHL,” Marc Pierron,
a senior credit analyst at Spread Research, said in a phone
interview.