The Basque Government buys 3% of CAF in its strategy to shield large companies in the Basque Country

The Basque Government is already part of the CAF (Construcciones y Auxiliar de Ferrocarriles) shareholders. It is a reference company in the railway sector and is also considered one of the jewels of the Basque business network. In the last year alone, CAF had a turnover of 2,943 million euros and obtained a net profit of 89 million. In total it has 13,000 workers, of which 3,000 are in the two plants it has in the Basque Country. The operation has been closed this week. The Basque Government announced this Thursday the acquisition of 602,552 shares for an average price of 28.30 euros each. In other words, it made a global investment of 17 million euros, which has allowed it to obtain 3% of the company's total shareholding. The Department of Economy and Finance highlights that the objective of this acquisition is to "strengthen" the "presence and position" of the Basque Executive in the share capital of "a company of special interest" for the Basque Country, given its "strategic nature". and tractor for the Basque economy». In fact, it is the last operation of the strategy that the Urkullu Executive launched in 2019 and with which it intends to “guarantee the roots” of the companies that it considers key to the economic development of the autonomous community. This mechanism has already allowed it, for example, to acquire 7% of the shareholding of the food company Kaiku. To do this, the Finkatuz fund was launched in July of that year, which could be translated as 'strengthening' or 'consolidating'. It is an exclusively publicly owned financial instrument whose main objective is to "strengthen" large Basque companies and avoid a possible relocation due to the entry of new investors. The lendakari himself, Iñigo Urkullu, highlighted during the presentation of this mechanism that the strategy sought to "support the establishment of competitive companies." Precisely this concept of roots is one of the criteria used by the Basque Institute of Finance, the entity chaired by the Minister of Economy and Finance in charge of managing the fund, to decide in which companies to invest. In their bases they explain that this concept will be “linked to the fiscal domicile” of the company. From the ministry they also add that it is a participation instrument expressly aimed at "large companies" and that the investments it makes have a "long-term vocation." The forecast, moreover, is that the participation of the Basque Government will not exceed 49% in any case, in such a way that it can never become a majority shareholder. In fact, both CAF and the Basque Government have pointed out that after the acquisition of shares, the regional Executive will not be able to sit on the company's board of directors. And it is that the statutes of the company prevent shareholders who do not have a stake of at least 10% from participating. From the council they explain that they never had the intention of increasing their control over the company. ITP, in the spotlight These statements, however, contrast with the attitude that the Executive has had in the negotiations to carry out a similar acquisition of shares in ITP aeronautics. The alarms went off when the Rolls Royce group announced its intention to sell the company to the US fund Bain Capital. Faced with the risk of relocation involved in the operation, the Basque Government opened talks to acquire part of the shareholding. And he also made it a condition to become part of the board of directors. The Minister of Economic Development, Arantxa Tapia, went so far as to say in the media that she "would love" for ITP to be the first operation carried out with the Finkatuz fund and that the essential thing was to avoid a "location transfer". The Basque Government was willing to invest around 100 million euros. However, the negotiations did not come to fruition and this week the sale operation was carried out. However, from the Basque Executive they do not rule out resuming negotiations in the future. MORE INFORMATION The Basque Government admits advances for its entry into ITP Aero Orange and Másmóvil close the merger of their businesses in Spain In the Government of Urkullu the criticism that came from the opposition for not having activated this mechanism in the face of the takeover bid launched by MásMóvil still resonates about Euskaltel. That is why in December 2021 the Basque Government decided to allocate the surplus of 200 million that it had obtained in tax collection to the Finaktuz fund. It has a budget of almost 300 million to continue advancing in investments that it considers "strategic".

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