Exclusive: EU regulators set to approve Atlantia's bid for Abertis - sources

By Francesca Landini and Foo Yun Chee

MILAN/BRUSSELS (Reuters) - Italian toll-road group Atlantia's 17 billion-euro ($20 billion) bid for Spain's Abertis is set to win EU approval, sources said on Tuesday, clearing another hurdle to getting the long-awaited deal done unless a counter-bid emerges.

Three sources with knowledge of the matter said that EU antitrust regulators were set to give unconditional approval to the bid on Friday.

Atlantia, which announced in May its proposal to acquire Abertis to create the world's largest toll-road operator, formally launched the cash-and-shares offer on Tuesday, a day after receiving the go-ahead from the Spanish market regulator.

The start of the offer period, which runs until Oct. 24, puts pressure on potential counter-bidder ACS, the Spanish construction group, to show its hand.

Under Spanish rules ACS, which said in July it was considering making its own offer for Abertis, has until Oct. 19 to present an alternative proposal.

"The clock starts ticking for ACS," Kepler Cheuvreux analyst Joaquin Ferrer said in a note, cutting the broker's rating on the stock to a "hold" from a "buy" due to the possibility of a bidding war between Atlantia and ACS.

Atlantia's shares were down 1.1 percent at 27.46 euros at 1406 GMT. Shares in ACS, which declined to comment, were down 1 percent at 30.51 euros while shares in Abertis were down 0.1 percent at 17.33 euros.

Atlantia is offering 16.50 euros in cash or 0.697 Atlantia shares for each Abertis share. But the offer is conditional on shareholders owning between 10 percent and 23 percent of the Spanish company's capital accepting the share offer.

POLITICAL UNCERTAINTY

At current market prices Atlantia will spend between 16.6 billion and 17 billion euros to buy Abertis. Back in May the deal was worth just over 16 billion euros but Atlantia's shares have risen 12 percent since then.

Spanish media reports have said ACS was considering an all-cash offer at 17 euros per share for Abertis and would team up with infrastructure and investment funds to raise the money needed to pay cash.

Political uncertainty over the situation in Catalonia, where the local government was considering the possibility of unilaterally declaring independence from Spain later on Tuesday, could also complicate any deal.

Abertis is based in Barcelona and its top shareholder is Criteria Caixa, the financial arm of a politically connected and powerful banking foundation that controls Caixabank, one of Catalonia's biggest lenders.

However, the company's board on Monday agreed to relocate its head office to Madrid, joining a business exodus from the region. ACS is based in Madrid and its chairman Florentino Perez is also at the helm of soccer club Real Madrid.

Political interference in the past blocked a planned tie-up between Atlantia and Abertis - a merger deal was scrapped in 2006 because of Italian government opposition.

($1 = 0.8485 euros)

(additional reporting by Robert Hetz in Madrid and Stefano Bernabei in Rome; Editing by Silvia Aloisi and Greg Mahlich)