OREANDA-NEWS. Fitch Ratings says Abertis Infraestructuras S.A.'s (Abertis; BBB+/Stable) acquisition of a 50% stake in Chilean Autopista Central (AC) has no rating impact but reduces its financial flexibility at a time when the deleveraging of its recourse business is expected.

On 21 January 2016, Abertis announced a cash-funded acquisition of a 50% stake in AC for EUR948m. The transaction gives Abertis the full ownership of the company, which operates a 61km urban network in Santiago del Chile under a concession agreement maturing in 2031. It is the country's busiest toll road with an average daily traffic of 81,000 vehicles. According to our preliminary calculation, Abertis's net leverage post transaction, under the rating case, will be around 3.5x in 2016 and further decrease thereafter, remaining below our 4x mark guidance for a negative rating action.

The deal will not affect Abertis's gross leverage but will further absorb the large cash balance that the company collected in May 2015 when it disposed 66% of its tower business for EUR2.1bn. In October 2015, Abertis invested EUR1bn of this cash to repurchase 6.5% of its own shares and is now using EUR948m to finance the AC acquisition. These cash outlays reduce the company's financial flexibility at a time when we expect a progressive reduction of its debt. However, Abertis has a track record of managing its leverage through partial divestment of its portfolio of valuable assets.

In our analysis of Abertis, we focus on the Spanish toll road business (recourse business perimeter) as the rated debt held at parent company (Abertis) level is primarily serviced from the cash flow generated from this business, which Abertis almost entirely finances via intercompany loans.

Compared with most of its peers, Abertis's Spanish portfolio of concessions has a shorter weighted average maturity and is highly concentrated, with its two most important concessions, Aumar and Acesa, which account for around 60% of overall EBITDA, maturing in 2019 and 2021, respectively. Under Fitch rating case, Abertis maintains comparatively lower leverage and progressively reduces its recourse debt as the maturity of its main concessions approaches.

Fitch expects to update its rating case over the next weeks. The review will also focus on Abertis's financial strategy on its Spanish toll business.