Talgo falls sharply in its return to the stock market as the takeover of the Hungarian Magyar Vagon cools

Talgo shares fell up to 7% when they returned to trading this Monday after the suspension of trading, set last Thursday until the takeover bid by the Hungarian group Magyar Vagon, owned by millionaire András Tombor, was confirmed.

Oliver Thansan
Oliver Thansan
11 February 2024 Sunday 15:48
9 Reads
Talgo falls sharply in its return to the stock market as the takeover of the Hungarian Magyar Vagon cools

Talgo shares fell up to 7% when they returned to trading this Monday after the suspension of trading, set last Thursday until the takeover bid by the Hungarian group Magyar Vagon, owned by millionaire András Tombor, was confirmed. The offer for 100% of the group having been ratified on Friday, the operation has been at the expense of a renegotiation with the banks that provide financial support to the company, which has stopped its imminence and weighed on the markets.

The investor proposes an operation for 100% of Talgo paying 5 euros per share, which implies a valuation of about 620 million. With this Monday's collapse, the stock has come to trade below 4.50 euros. Before the price was suspended it was around 4.80 euros.

Currently the company's main shareholder is the Trilantic investment fund. The purchase depends on a renegotiation with around twenty entities, which have a control clause that they can execute if the company's ownership changes hands. The CNMV has informed Magiar Vagon that it is not permitted to subject the offer to the condition of obtaining the consent of the financing entities for the change of control.

Thus, in the absence of this chapter being closed, in the same statement to the CNMV in which it recognized the interest, the Hungarian company said that "there is no certainty that a takeover bid for Talgo will be formulated." If it goes ahead, it would be through the Hungarian train manufacturer DJJ (Dunakeszi Jarmüjavító), a subsidiary of Magyar Vagon.

Trading had been suspended on Thursday as a precautionary measure and with immediate effect after its shares on the stock market had suddenly skyrocketed by 10% due to rumors of a takeover bid. When the possible operation became known in November, Talgo was trading at 3.9 euros and the same situation occurred, so the CNMV suspended it for a few hours. At no time have the titles reached the proposed 5 euros.