The Ferrovial shareholders' meeting gave an almost definitive endorsement yesterday to the plan to transfer the headquarters from Spain to the Netherlands, strongly criticized by the Government. The management found not only overwhelming support from the shareholders for its proposal, but also harmony in all the interventions of individuals and a standing ovation at the end of the assembly. The closest thing to criticism was a request from a shareholder for simultaneous translation at future meetings outside of Spain and a free telephone service in Spanish.
The meeting, in the Once auditorium on Madrid's Paseo de la Habana had generated enormous expectations. The quorum, between face-to-face, delegated and online voting, far exceeded what is usual for a company with highly fragmented capital, exceeding 77% of the shares. Nearly 500 shareholders had to be accommodated in the auditorium and also a hundred accredited journalists.
Attention was focused on a single point on the agenda, the tenth, the one related to the operation for the change of venue. It was approved by 93.3% of the capital, almost "Bulgarian", as was commented yesterday from the company environment. The votes against were 5.79% and the abstentions, 0.9%.
Not only the president and his sister María del Pino, with more than 28% of the capital between the two, voted in favor, but also the main international investors, including the activist Chris Hohn and the Norwegian sovereign wealth fund.
Leopoldo del Pino, brother of the president and owner of 4%, voted against the transfer, although he intends to keep the shares. If he decides to exercise the right of exit and demand that the company that buys the shares from him, he could jeopardize the change of headquarters operation.
The president of the company, Rafael del Pino, defended the project and faced criticism in recent weeks. The change of headquarters is part of the "natural development" of the group and is not done "for tax reasons," he said, in his first public intervention since Ferrovial announced the plan at the end of February.
The merger "seeks to improve the ability to compete and promote international growth", which is "the great bet to continue creating value", he added. The company obtains 82% of its income outside of Spain and considers that from the Netherlands it will have greater access to international capital.
Del Pino addressed several messages to the Government. The board, he affirmed, is the one that has the "sovereignty" to make decisions, while the company has the "right of free establishment in the EU." He also stated that "Ferrovial is not leaving Spain." “It has always been our country and we will not give it up.”
He also descended into the details in his clash with the Government. "The fact that we do not pursue any tax advantage allows the operation to qualify for the merger neutrality regime," he said, alluding to the threat to penalize the company with taxes.
Regarding the possibility of listing in New York from Spain, he insisted that doing so through the Netherlands is the most efficient formula. “It is a proven way to list in the United States in a short period of time. It is not easy to do it from Spain because the process and the execution period are uncertain”, he affirmed.
Ferrovial understands that the transfer will give it visibility because the Netherlands is "an important nerve center" and because of the possibility of making the leap to the United States from there.
Of the 856 million euros invested last year by the company, indicated Del Pino, more than 60% has gone to this country, where "the main projects" are also being developed. He cited the construction of terminal one at the JFK airport in New York, in which more than 1 billion dollars will be invested.
To yesterday's support from shareholders was added a rise in the stock market of 0.9%, up to 27.39 euros. The price of the shares is important because it removes the possibility that shareholders dissatisfied with the merger exercise their right of separation and demand the purchase of the titles by Ferrovial. The exit price is 26 euros per share, so resorting to it now would not be very advantageous.
The company has said that if more than 2.56% of the capital opts for this option and is forced to disburse more than 500 million euros, it will renounce the change of headquarters. From now on, there is a period of one month to exercise this right.
Ferrovial offered the calendar yesterday with the following steps. During the second semester the process will be completed, so that next year the company will already be operating from its new headquarters. Between July and December the merger will be completed and trading will begin in the Netherlands, the United States and Spain.
The company does not stop taking steps and yesterday published in the Mercantile Registry the name of the new Spanish subsidiary, which will depend on the Dutch parent company. It will be called Ferrovial International SE Sucursal en España and will be managed by Ignacio del Pino, who is the second son of the president and current financial director. At 34 years old, he has become one of the best positioned managers for the generational change. 80% of the business already depends on the Dutch company.
