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CVC’s tobacco consortium has no intention of walking away from Altadis at this stage, it is understood.
Many in the market assume that CVC will not be able to top Imperial Tobacco’s agreed EUR 50 per-share offer for the company. CVC’s camp had previously said that its indicative price of EUR 50 was a very full one.
However, it is thought that CVC is under no pressure to walk away from the situation, even if it might not necessarily bid. CVC’s camp has calculated that it has until the end of October to make a decision, it is understood.
The exact timing of a deadline to bid is unclear for two reasons. On the one hand, the date depends on when the Comision Nacional del Mercado de Valores [CNMV] will approve Imperial’s offer document. On the other hand, the way the date is calculated is likely to change under the new takeover code, which will come into effect in August.
One advantage for CVC not to walk away is that it might be able to buy some of the assets that Imperial does not want. The private equity firm’s camp had previously indicated that it would be open to some kind of deal with the tobacco company.
When Imperial announced its offer, it said that it would take a decision on whether to bid for Altadis’s logistics affiliate Logista at a later stage and would initially only sell those assets that the Franco-Spanish company had identified as non-core.
However, in recent days, there has been considerable speculation in the press that Imperial could sell Logista and other assets. In this scenario, CVC might well be well placed to bid for these businesses, it is understood.
The advantage that CVC has is that if it tables a rival offer for Altadis, the deal would automatically go into a sealed envelope round. This could make it much more expensive for Imperial to make a knock-out offer.
One person close to CVC’s camp said that Altadis’tobacco business clearly has a greater scarcity value for a trade buyer than it does for a financial buyer.
If the draft version of the new Spanish takeover is confirmed, it will make it easier for rival bidders to join forces. One logical way of doing so would be for CVC to table an offer for Logista. It is understood that this could be one of the many options that CVC will be considering.
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