America Movil threatens to abort €7.2-bn bid for Royal KPN
31 Aug 2013
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America Movil, the telecom giant controlled by Mexican billionaire Carlos Slim, yesterday threatened to walk away from its €7.2 billion ($9.5 billion) bid for Royal KPN after the Dutch telecom company's foundation said that it would veto the deal.
The foundation, an independent group of former Dutch companies' executives, whose aim is to safeguard the interests of KPN and its shareholders, yesterday acquired nearly 50 per cent of KPN's voting stock in order to block the deal.
Jacques Schraven, the foundation's chairman, said at a press briefing in Amsterdam that it is difficult to determine whether this offer is fair, and has asked America Movil to revise its offer, but the Mexican company has not responded.
Early this month, America Movil, which holds around 30 per cent of KPN, tabled a €2.40 a share in cash bid for the remaining it does not already own, a premium of around 35.4 per cent over the average closing price of KPN's shares on Euronext Amsterdam for the last 30 trading days.
The foundation believes that the offer is not in the best interests of the company, and América Móvil had not informed KPN about its plans before making the offer.
''The foundation believes that América Móvil has knowingly opted for a hostile approach by not first trying to reach agreement on a merger protocol with KPN,'' the foundation said in a statement. ''As a result, uncertainty has arisen among a number of stakeholders concerning their position.''
America Movil has refuted the foundation allegations and said that it had discussed the deal with KPN's management, its board and the Dutch government, all of whom had favoured the deal. It added that it was still negotiating a new agreement, but would withdraw if ''the foundation maintains its current position.''
Analysts say that the foundation, set up in 1994 when the Dutch government privatised state telecom companies, may be seeking clarity on employee compensation, bonus packages and continuing with the present management before agreeing to the deal.
The KPN acquisition would come as América Móvil's largest takeover bid ever outside Latin America, and follows a deal last year to up its stake in Telekom Austria, another European operator, to 23 per cent.
Other operators, including Vodafone as also John Malone's Liberty Global, have also been picking up telecommunications and cable assets across Europe.
Last month KPN agreed to sell its German subsidiary E-Plus to the Spanish operator Telefonica for €5 billion ($6.5 billion) in cash and stock.
The foundation, an independent group of former Dutch companies' executives, whose aim is to safeguard the interests of KPN and its shareholders, yesterday acquired nearly 50 per cent of KPN's voting stock in order to block the deal.
Jacques Schraven, the foundation's chairman, said at a press briefing in Amsterdam that it is difficult to determine whether this offer is fair, and has asked America Movil to revise its offer, but the Mexican company has not responded.
Early this month, America Movil, which holds around 30 per cent of KPN, tabled a €2.40 a share in cash bid for the remaining it does not already own, a premium of around 35.4 per cent over the average closing price of KPN's shares on Euronext Amsterdam for the last 30 trading days.
The foundation believes that the offer is not in the best interests of the company, and América Móvil had not informed KPN about its plans before making the offer.
''The foundation believes that América Móvil has knowingly opted for a hostile approach by not first trying to reach agreement on a merger protocol with KPN,'' the foundation said in a statement. ''As a result, uncertainty has arisen among a number of stakeholders concerning their position.''
America Movil has refuted the foundation allegations and said that it had discussed the deal with KPN's management, its board and the Dutch government, all of whom had favoured the deal. It added that it was still negotiating a new agreement, but would withdraw if ''the foundation maintains its current position.''
Analysts say that the foundation, set up in 1994 when the Dutch government privatised state telecom companies, may be seeking clarity on employee compensation, bonus packages and continuing with the present management before agreeing to the deal.
The KPN acquisition would come as América Móvil's largest takeover bid ever outside Latin America, and follows a deal last year to up its stake in Telekom Austria, another European operator, to 23 per cent.
Other operators, including Vodafone as also John Malone's Liberty Global, have also been picking up telecommunications and cable assets across Europe.
Last month KPN agreed to sell its German subsidiary E-Plus to the Spanish operator Telefonica for €5 billion ($6.5 billion) in cash and stock.
