NewsDJ MARKET TALK: Repsol Overstretches Sacyr Business Model
10/18/06 - Dow Jones Newswires
1508 GMT [Dow Jones]--Sacyr's (SYV.MC) acquisition of a 9.2% stake in Repsol (REP) overstretches its business model, says Merrill Lynch. Notes management stated that dividend income from Repsol and non-recourse debt element led Sacyr to view the investment in the same light as an infrastructure concession. Sees Repsol's risk profile considerably higher than that of an infrastructure concession; while non-recourse debt supporting the acquisition is only 5-6 years long, "which introduces significant refinancing risk." Rates Sacyr sell, EUR32 fair value. Trades +1.3% at EUR41.3. (SJP)
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(END) Dow Jones Newswires
October 18, 2006 11:08 ET (15:08 GMT)
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