America Movil eyes full control of KPN

As predicted in July, Latin American operator group America Movil has made an offer to acquire the outstanding shares in Dutch operator group KPN. The Mexican firm already owns a 29.8 per cent stake in KPN but is looking to own it outright, or at least secure a majority share, as it steps up its efforts to expand further into Europe.

Also, despite Telefónica’s July proposal to acquire  KPN’s German subsidiary, E-Plus, America Movil still has hopes to keep the German unit in the mix if it’s own acquisition goes ahead.

America Movil said it intends to make a public offer in cash for all outstanding ordinary KPN shares at a price of €2.40 per KPN share. The operator, owned by billionaire Carlos Slim, said the offer implies a premium of approximately 35.4 per cent over the average closing price of KPN’s ordinary shares for the last 30 trading days.

The offer will be subject to conditions, America Movil added, which will include a minimum acceptance condition that América Móvil will hold more than 50 per cent of the voting rights exercisable in a general meeting of shareholders of KPN.

The Dutch operator’s Board of Management and Supervisory Board said they were informed in advance and will carefully consider América Móvil’s intended offer.

“In recent years, América Móvil has been exploring opportunities to expand its operations to other regions outside the Americas in order to achieve geographical diversification and create attractive long-term returns for its shareholders,” America Movil said in a statement.

“KPN represented its first investment outside of the Americas. More than a year after its initial investment in KPN, América Móvil’s objective is to acquire a majority stake in KPN in order to facilitate greater operational cooperation and co-ordination between the two companies, to exploit all areas for potential partnerships and to intensify the realization of synergy potential for both companies.”

As well as its domestic business in the Netherlands and E-Plus in Germany, KPN has a Belgian subsidiary in Base and runs an MVNO under the Simyo brand in France. It also owns roaming solutions provider iBasis and offer ICT services to Benelux countries through subsidiaries Newtel Essence, Gertronics , Nozema and CSS Telecom. KPN said that it is currently unclear which elements of the business will be involved in any deal and America Movil was unavailable for comment at the time of writing.

América Móvil ended an agreement to cap its stake in the Dutch based firm late July after it increased its stake in the group in February 2013. At the time, the two firms struck an agreement to cap America Movil’s stake in the firm at 30 per cent. However, this pact expired after Spanish operator group Telefonica, a fierce rival to América Móvil in Latin America, bid €8.1bn ($10.7bn) for KPN’s German mobile arm E-Plus earlier in the month.

On July 23, 2013, KPN announced that it had “entered into a transaction, subject to shareholder approval, to sell and transfer 100% of its interest in E-Plus to Telefonica Deutschland for €5bn in cash and a 17.6 per cent stake in Telefonica Deutschland post transaction”. However, America Movil said that, according to KPN’s announcement the transaction is subject to other terms and conditions, including merger clearance.

“América Móvil is carefully evaluating the merits of the proposed transaction and will make a final determination in relation to the exercise of its voting rights at the upcoming Extraordinary General Meeting of KPN,” the Latin American group said in a statement.