Spanish construction group OHL confirmed on Tuesday it was in preliminary talks with an unnamed investment fund over a joint bid to take its Mexican unit private.
Earlier on Tuesday, a source familiar with the discussions said Australian fund management firm IFM, which already has joint operations in Mexico with OHL, was looking into a potential joint buyout of OHL Mexico.
Shares of OHL Mexico rose more than 20 percent to US$1.34 (25.31 pesos) on the news, their largest daily gain since 2010. Mexico's stock exchange halted trading of the shares to control price volatility.
A spokesman for IFM in London said the firm did not comment on speculation linked to acquisitions. Spain's Expansion newspaper first reported that IFM was in talks with OHL.
OHL, which has a 56 percent stake in OHL Mexico, added in a statement to Spain's stock market regulator that it would not under any scenario invest more in buying additional shares in its Mexican subsidiary.
"OHL has agreed with IFM to look into a buyout offer for OHL Mexico. IFM would put the money in and OHL would not participate in the offer," the source familiar with the discussions said, adding that OHL would look to maintain its current stake.
OHL has faced several setbacks at its Mexican unit in recent months. It was fined just over US$4 million earlier this year by Mexican regulators over inadequacies in its financial reporting, though no evidence of fraud was found.
The Spanish parent company also recently had to sell a seven percent stake in infrastructure firm Abertis to satisfy margin calls after OHL Mexico's shares tumbled.
IFM, via its IFM Global Infrastructure Fund unit, last year bought a 24.99 percent stakes in two road concessions belonging to OHL in Mexico.
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