MADRID — Norway’s sovereign fund will oppose Ferrovial’s plan to relocate to the Netherlands at the Spanish engineering company’s shareholders’ meeting this week, after the Spanish government criticized the proposal put forward by the board.
The $1.4 trillion fund, which holds a 1.49% stake in Ferrovial, said on its website it would vote against the planned reverse merger through which the company, which operates London’s Heathrow airport and makes most of it revenues abroad, would be absorbed by its wholly-owned Dutch subsidiary FISE.
The proposal will be submitted to shareholders during the annual general meeting on Thursday.
Ferrovial’s board said in February the relocation was designed to set up a platform to allow it to eventually be listed in the United States and join stock indexes there.
Deputy Economy Minister Gonzalo Garcia told RNE radio on Tuesday he had been in talks with Ferrovial CEO until Monday and advised its shareholders in a letter that there was nothing to prevent a Spanish-based company from applying for a U.S. listing.
“These conversations have been useful in making them aware that there is an alternative to access the U.S. market from Spain, which is good news for them and for other companies,” he added. He said the tax service will have to evaluate the transaction’s capital gains if it is approved.
Labour Minister Yolanda Diaz has accused Ferrovial of trying to dodge taxes, but company spokesman Francisco Polo told OndaCero radio the plan had no tax advantages. However, the economic reasons, such as improved capitalisation, liquidity and access to financing, were obvious, Polo said.
He said it was currently impossible to get a U.S. listing from Spain because of issues including the incompatibility of depositories in the two countries.
The Norwegian fund cited its general guidelines on corporate decisions, saying it has to consider “whether there is sufficient transparency to make a fully informed decision, whether all shareholders are treated equitably, and whether there are any unnecessary conflicts of interest.”
Proxy adviser Glass Lewis & Co said the relocation would not have a significant effect on shareholder rights though it could have “negative reputational impact” in Spain.
Three associations defending minority shareholders on Monday supported Ferrovial’s move. (Reporting by Inti Landauro and Corina Pons; Editing by Andrei Khalip and Barbara Lewis)