The consortium of Basque investors, led by José Antonio Jainaga, president of Sidenor, has reached an agreement in principle with the Trilantic fund to acquire its 29.77% stake in Talgo, definitively clearing the process of selling the company.
The transaction, valued at 4.25 euros per share(0.10 euros more than the amount offered on 6 February) plus a variable component of 0.55 euros depending on the fulfilment of Talgo’s business plan in 2027 and 2028, has been confirmed by the Provincial Council of Álava and is awaiting registration with the National Securities Market Commission (CNMV).
The deal involves an initial outlay of €156.7 million, with an additional payment of €20.37 million expected after 2029 for the additional €0.55 million. This leaves the final value of the deal at €177.07 million.
In addition to Sidenor, the consortium is made up of the banking foundations BBK and Vital, as well as the Basque public fund Finkatuz. Vital will contribute 20 million, while the remaining amount will be divided equally between the other three partners.
The deal follows the withdrawal of two takeover bids for 100% of Talgo, one led by Polish state fund PFR and the other by Indian train manufacturer Jupiter Wagons.
The withdrawal is a consequence of the government’s preference for the Spanish route, as it considers Talgo a strategic company and seeks to protect it from possible foreign interference. The Minister of Economy, Carlos Cuerpo, conveyed this message to representatives of the Polish government during a recent visit to Warsaw.
The central and Basque governments have actively supported Sidenor’s proposal, prioritising the maintenance of Talgo’s roots in Spain, including its production centres, jobs, patents and stock exchange listing. This commitment is the response promoted by Moncloa after vetoing the purchase of 100% of Talgo by the Hungarian Ganz-Mavag.
This agreement in principle brings to a close a sale process that began in August 2021, when it became known that Trilantic wanted to sell its share.
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Talgo’s future more or less on track
The new shareholders face the challenge of implementing an industrial plan to address Talgo’s lack of production capacity, evidenced by delays in the delivery of Avril high-speed trains to Renfe.
Talgo has a record order book of 4 billion euros, but needs to expand its manufacturing facilities. Although PFR and Jupiter Wagons offered short-term solutions, the Spanish government has urged patience, suggesting possible future commercial agreements or integrations to strengthen Talgo.
Ramiro González, deputy general of Alava, welcomed the agreement, highlighting its importance for the industrial fabric of Alava and its suppliers, as well as the symbolism of the return of Talgo’s decision-making centre to Alava, where it has its largest plant in Rivabellosa. Talgo’s head office is expected to move from Madrid to Alava.
Torreal separates from Pegasus Transportation
In parallel to the operation, there have been internal tensions at Talgo. In addition to the departure of several board members, including the non-executive vice-president José María Oriol, the Pegaso Transportation fund and the investment company Torreal, owned by the Abelló family, have separated their 3.53% stake from the rest of their shareholding.
Talgo’s share price has been volatile in recent days, reflecting the uncertainty surrounding takeover bids. The share closed today’s session at 3.85 euros, after an initial collapse in the face of foreign takeover bids being withdrawn.
