MADRID (Reuters) -The Spanish government has allowed activist fund Amber Capital to raise its stake in Indra to 9.99%, the defence company said on Friday.
According to data from Refinitiv, Amber Capital holds 4.2% of Indra and would become its second-biggest shareholder after state holding company SEPI, which earlier this year increased its stake to 25.2% from 18.75%.
Shares in Indra were up 2.25% on Friday, leading gains in Spanish blue-chip index Ibex-35, which was down 1.03%.
Indra still has to replace seven independent board members that were ousted or quit in June after shareholders unexpectedly agreed to give the government more control.
The company on Friday said the selection process for the directors was already at a very advanced stage and nearing completion. The appointments committee is expected to meet on Monday, Indra added.
The government's bigger role in the company comes ahead of the rollout of a jet fighter programme, and as Spain looks to increase defence spending in the wake of Russia's invasion of Ukraine.
The government on Tuesday authorised the joint foreign investment of Amber Capital UK and Amber Capital Italia SGR in Indra "up to a joint participation in shares, or other financial instruments with shares as underlying value, representing 9.99% of its share capital," Amber said in a letter.
At current market prices, the 10% stake in Indra has a value of around 140 million euros ($139.69 million).
(Reporting by Emma Pinedo; Additional reporting by Jesús Aguado; Editing by Jesús Aguado, Kirsten Donovan and Mark Porter)