September 10, 2019 / 9:13 PM / 11 days ago

Ferrovial unit appeals Canadian court decision on SNC Lavalin highway sale

MONTREAL, Sept 10 (Reuters) - A unit of Spain’s Ferrovial S.A. is appealing a Canadian court decision that green-lighted the sale of SNC Lavalin Group Inc’s 10.01% stake in a toll highway for C$3.25 billion ($2.47 billion), a source and the Montreal-based company told Reuters on Tuesday.

Cintra Global S.E. has given notice to the Court of Appeal for the Canadian province of Ontario that it will appeal a ruling that allowed SNC to sell the coveted stake, said the source who spoke on condition of anonymity because the company’s decision has not yet been made public.

Cintra, already a shareholder in Canada’s Highway 407 toll road operator, had argued it had a right of first refusal and should be allowed to buy up to 5.2% of the stake put up for sale by SNC.

Canada Pension Plan Investment Board (CPPIB) bought the stake in August, in a deal closely watched by SNC shareholders.

The sale is aimed at paying down SNC’s debt at a time when the engineering and construction firm is restructuring its business, after wrestling with higher-than-expected expenses in its main unit.

An SNC spokeswoman confirmed Cintra was appealing the Ontario Superior Court decision, but said that it “has no impact” on the company.

Cintra declined to comment.

SNC-Lavalin still has a 6.76% stake in Highway 407.

SNC stock closed up more than 12% on Tuesday to C$17.92 a share, after brokerage CIBC said it would resume coverage and set a price target of C$25.

SNC stock is down more than 60% in the year to date.

$1 = 1.3144 Canadian dollars Reporting by Allison Lampert; Editing by Peter Cooney

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