STOCKS NEWS EUROPE-Ansaldo STS boosted by Peru contract prospect

Shares in Ansaldo STS (Milan: STS.MI - news) rise 3.6 percent to the top of Italy's mid-cap index as a consortium including the rail signalling and transportation group emerges as the sole bidder for a contract in Peru.

The consortium, formed by builders from Peru, Italy and Spain, has bid for the construction of a $6.6 billion train line in Lima, Peru's state investment agency Proinversion said late on Friday.

"The Metro Lima contract could weigh as much as 28-34 percent of the new order intake target set by STS for 2014," Banca Akros says in a note.

It adds that the value of the deal pertaining to Ansaldo STS could be worth around 480 million euros ($661.6 million).

The consortium is made up of Peruvian company Cosapi; Italian companies Salini Impregilo (Frankfurt: IPJ1.F - news) , Ansaldo STS , and Ansaldo Breda; and Spanish builders Iridium Concesiones de Infraestructura and Vialia Sociedad Gestora de Concesiones de Infraestructura.

Ansaldo STS and loss-making train maker Ansaldo Breda are two units defence and industrial group Finmeccanica (Other OTC: FINMF - news) is planning to sell to cut debt.

"The (Peru) news is clearly positive for STS as well as for (Ansaldo) Breda; we believe that a similar contract might even accelerate the STS/Breda stake disposal from the side of Finmeccanica," Akros adds.

It estimates the rolling stock component pertaining to Ansaldo Breda could be worth another 240 million euros ($330.78 million).

Media reports over the weekend reiterated that U.S. industrial giant General Electric (Swiss: GE.SW - news) , Japan's Hitachi , France's Thales (Paris: FR0000121329 - news) and Canada-based Bombardier were interested in the assets. A trader says this gave additional support to the stock.

Reuters messaging rm://elisa.anzolin.thomsonreuters.com@reuters.net

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