Bill Gates becomes second-largest shareholder in construction firm FCC

The share price of Spanish construction company FCC shot up over 10 percent on Tuesday to levels last seen in March 2012 on news that investment funds controlled by US business magnate and Microsoft founder Bill Gates have acquired a 6-percent stake in the company.

The rise comes on the heels of a 5.4-percent increase on Monday after word of the operation was apparently leaked. Speaking about the rise on Monday, the chairwoman of the National Securities Commission (CNMV), Elvira Rodríguez, said: “I don’t know whether [the share price] rose on Monday due to insider trading or whether the market had knowledge of [the deal].”

The move is being interpreted as Gates’ betting on the recovery of the Spanish construction sector, which was hit hard by the collapse of the real estate market in 2008 and sharp cuts in investment in public works as part of the government's austerity drive.

The construction firm’s shares at one point in Tuesday's session were up by as much as 13.26 percent at 17.75 euros after trading was suspended for more than 20 minutes due to a mismatch between buy and sell orders. By mid-afternoon, the shares were up 9.83 percent at 17.21 euros.

The deal sees Gates become the second-biggest shareholder of the construction group after Esther Koplowitz, who controls 53.9 percent of the firm. The cofounder of Microsoft and one of the richest men on the planet has bought into FCC while it is in the process of implementing a strategic plan to reduce its debt and return to profitability.

Sources close to the company indicated that contact with funds connected to Bill Gates was established via FCC’s investor relations department, which has been running a permanent roadshow since it presented the plan in March of this year.

The company specifically sold Gates 6 percent of its treasury stock, shares the company holds in itself, according to a statement FCC filed with the CNMV. The operation was completed at a price of 14.865 euros per share, a discount of 4.5 percent to Monday’s closing price of 15.56 euros.

FCC lost 607.6 million euros in the first quarter of the year, in drastic contrast to a profit of 53.4 million in the same period in 2012, due to the company's deconsolidation of its Austrian unit Alpine and writedown of the value of its renewable energy assets.