Sacyr Vallehermoso faces the prospect of having to make a higher, cash bid for its French peer Eiffage after French bourse regulator AMF ruled that an earlier hostile all-share offer did not comply with French law. Siding with suggestions by Eiffage that the Spanish construction company - which owns a third of Eiffage's shares - may have acted in concert with other Spanish shareholders, the AFM said the French financial code requires a takeover offer to be at least equal to the highest share price paid by the buyer or its partners over the 12 months prior to the bid.

Sacyr Vallehermoso faces the prospect of having to make a higher, cash bid for its French peer Eiffage after French bourse regulator AMF ruled that an earlier hostile all-share offer did not comply with French law. Siding with suggestions by Eiffage that the Spanish construction company - which owns a third of Eiffage's shares - may have acted in concert with other Spanish shareholders, the AFM said the French financial code requires a takeover offer to be at least equal to the highest share price paid by the buyer or its partners over the 12 months prior to the bid.

A second article in the code requires Sacyr to add a cash element to its offer, the regulator said. Eiffage said in a statement that this means Sacyr has to offer at least EUR 129.3 per share - 25% more than the first bid. Sacyr, whose shares fell as much as 7% to EUR 33.59 on Wednesday in the wake of the ruling, said it will appeal.