SPAIN: The Spanish government has vetoed the proposed acquisition of 100% of rolling stock manufacturer Talgo by Hungarian consortium Ganz Mavag Europe, saying confidential analysis had determined that the deal posed ‘a risk to national security and public order’.
The reasons for the decision announced on August 27 are classified, but the government said Talgo is a strategic company in a key sector for economic security, territorial cohesion and industrial development, and blocking the deal would protect Spain’s strategic interests and national security.
Stock market regulator CNMV immediately suspended the trading of Talgo shares.
Stressing that Spain is open to foreign investment, the government said the decision fully respected EU rules on foreign direct investments, the internal market and the free movement of capital.
Foreign investment
A possible takeover of Talgo has been speculated for some years, and 40% owner Trilantic is looking to divest its stake. The remainder of the company is in the hands of numerous smaller investors.
In March this year, the Ganz-Mavag Europe consortium of rolling stock manufacturer Magyar Vagon (55%) and Hungarian state-owned investment fund Corvinus (45%) put forward a €619m offer.
The Spanish government was not keen to see Talgo in foreign ownership, and Transport Minister Óscar Puente has said the government would do everything possible to prevent it.
Concerns were raised over the consortium’s links to the Hungarian government and potentially to Russia.
In 2022 Magyar Vagon became 100% owner of the Dunakeszi Járműjavító coach factory by acquiring the 50% stake in the TMH Hungary Invest joint venture previously held by Russia’s Transmashholding.
Responses
Ganz-Mavag told local media that the consortium planned to take legal action over the Spanish government’s decision to block the acquisition.
Talgo told Railway Gazette International that it would wait for Ganz-Mavag to inform it of its next steps and then make its own decisions. It said ‘Talgo will continue with its industrial and business activity and its commitments to workers, customers and suppliers as it has done throughout its more than 80 years of history’.
The AEMEC association of minority shareholders in listed companies said it would challenge Spain’s rules on blocking foreign investments. It suggested that a regulation which was brought in to prevent foreign companies buying up Spanish firms during the pandemic made sense at the time, but has now lost its reason for being and harms shareholders by limiting the possibility of selling their shares.
