La Caixa exhibits muscle at Naturgy after failing the IFM fund takeover bid


The journey of IFM to assault Naturgy it got steeper each day as the final term of the takeover approached, until it became an almost vertical slope. The Australian fund has finally reached the finish line, but now without strength and with La Caixa in top form. Outcome:
will have to settle for 10.83% of the share capital
, when his intention was to get up to 22.7% and a minimum of 17%.

Market sources speak directly of “failure” since they have had to greatly lower their objectives. Not only for having been able to acquire that percentage -equivalent to about 2,300 million euros-, but also because he is forced to accept that his presence on the council

administration will be left to one person.

“We are excited by the prospect of contributing our experience and technical knowledge to continue supporting the strategy that the group has envisaged,” said Jaime Siles, vice president of IFM Investors. Sources close to the fund explain that their intention remains the same as before:
support the strategic plan, the investments planned, to continue growing
. And that’s where one of the Australians’ ‘sins’ in their assault has emerged.

IFM stated weeks ago that, if necessary,
would propose to reduce or even eliminate the dividend
from Naturgy to delve into the strategic plan. That’s what they thought then … and that’s what they think now. They maintain their kind of order that they do not enter the energy sector for shareholder remuneration, which they would be willing to dispense with if necessary.

The latter was the straw that broke the camel’s back for the most powerful shareholder in Naturgy: the La Caixa Foundation, which operates through the Criteria holding company. The relationship of the entity chaired by Isidro Fainé with IFM has not been good practically from the beginning, but the threat of snipping it or directly squandering the dividend did not sit well with the holding company. In fact, Fainé came forward with public statements, something unusual, to defend himself against the attack because Naturgy’s remuneration, for La Caixa, is sacred.

Bridges laid

Sources close to IFM, after having failed in their assault and having to settle for less than half of what was initially raised, point out that they have no red lines with any of the shareholders. Neither with La Caixa, nor with GIP, nor with Rioja, nor with Sonatrach, which together account for more than 70% of the capital. The Australian fund reaches out to the large shareholders of the energy company and is open to reaching agreements with all of them.

Even so, financial sources consider that the relations between La Caixa, which holds the 26.7% of capital and that a new director will win, and IFM has a difficult time redirecting it as long as the Australians remain entrenched in their threat to the dividend. They have had many months to establish relationships, or rather to regain them, since the holding company already knew the fund well, and it has not led to friendship. Quite the contrary, also from the beginning.

The failure of the tender supposes the triumph of La Caixa, and the muscle that it exhibits as the main shareholder of the gas company. His show of power dates back months, when Criteria announced in response to IFM that would continue to buy Naturgy shares until reaching a little less than 30% of the shareholders.

It was about transmitting a message that they are fully committed to energy and that they wanted to remain as the main shareholder, increasing their participation even more. Now the doubts that arise are regarding whether IFM and La Caixa will fight a war buried through the board of directors, but sources close to the Australian fund acknowledge that its ability to act is reduced after the original objective has not been achieved. And with the hard core of the company against you, your margin is very slim.

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