Impresa increases capital and Italian MFE retains less than 33%

Negotiations between Impreger, owner of the company that controls SIC and Expresso, and MediaForEurope (MFE) are ongoing and should be announced to the market by the end of this week. After advances and setbacks, the operation will be carried out through a capital increase in the listed company, Impresa, with the Italians entering with a shareholding of up to 33.3%, which will dispense with the obligation of a takeover bid, ECO learned from sources familiar with the deal. With this operation, Impresa will receive a capital injection of between €20 million and €40 million, depending on the value of the capital increase per share. But in the business plan, this will be the first of two operations to eventually take control of the company, a strategy identical to the one confirmed a few weeks ago in Germany.

Impresa’s shares have been suspended from trading on the stock exchange since last Friday. When questioned by ECO, the official response remains: “Impresa will always communicate relevant information to the market, in accordance with the law. There is no relevant information to be communicated.”

According to ECO’s calculations, and taking into account Impresa’s current share capital, a capital increase that complies with the objective of not exceeding 33.3% of the capital, the limit to avoid a change of control of the company and the obligation of a takeover bid (OPA), will be a maximum of around €41 million if it were at the so-called nominal value, i.e. one euro per share. However, given the company’s financial situation, there will be a discount on this amount. In the scenario of a 50% discount on the nominal value, and taking into account that Impresa’s share capital is 84 million euros, an increase of more than 20 million will allow the aforementioned 33% to be reached.

In both scenarios, and bearing in mind that the heirs of the recently deceased Pinto Balsemão control 51.81% of the voting rights, they will move to a position very close to 35%, followed by the Italians with 33%. They will still have to prove to the CMVM that they do not have a concerted position, otherwise they will be obliged to launch an offer even if the new shareholder’s threshold is below 33.3%.

Last Friday, it should be recalled, the market supervisor decided to suspend trading in shares of Impresa SGPS, the listed company that owns SIC and Expresso, following a report in the news magazine Sábado that pointed to a two-phase business development. Initially, MFE would take a minority position. Now, according to information gathered by ECO, the deal has stabilised and will be done through Impresa, not Impreger.

Initially, on 27 September, Impresa confirmed that negotiations were underway with Italy’s MFE, formerly Mediaset, without giving details of the terms of the deal. At the time, it was assumed that one of the scenarios would be a takeover of Impreger, a fact reinforced a few days later by Impresa’s own announcement to the market that there could be a change in the group’s shareholder control. However, in light of Articles 186 et seq. of the Securities Code, a change of control at Impreger would require a takeover bid. It was precisely this scenario that led to the sharp rise in Impresa’s stock market value in recent weeks.

Now, the scenario, which has not been denied, appears to be different. The five children – Mónica, Henrique, Francisco Maria, Joana and Francisco Pedro – share the shares in Balseger, which holds 71.4103% of the share capital of Impreger SGPS, SA, which, in turn, has 50.311% of the voting rights of Impresa, owner of Expresso and SIC, according to a statement to the Portuguese Securities Market Commission (CMVM). The heirs also requested a “derogation from the obligation to launch a public takeover bid”, arguing that there was no acquisition to obtain control, but only natural succession.

This operation by the Italians is the first in a series of interventions that will follow to strengthen a weak capital structure that is under pressure due to debt. According to another source, there will be negotiations with the banks for a debt haircut of around 30%, in addition to the goal of reselling the building in a sale and leaseback model, after the failure of the deal with a BPI fund a few weeks ago. In the long term, the path will be towards majority control of Impresa.