Másmóvil takes on the big guns as shareholders back buyout

Shareholders of Spain’s Másmóvil have voted overwhelmingly in favour of a €3 billion takeover deal that will take the company private.

Holders representing 86.41% of Másmóvil’s shares have accepted the €22.50-per-share offer lodged by private equity funds Providence, Cinven and KKR in June, Spanish stock market regulator the CNMV revealed on Thursday. That figure far exceeds the 50% minimum acceptance rate for the deal to go ahead.

The support for the deal puts paid to objections from certain minority shareholders, including UK-based Polygon Global Partners, which has been vocal in its insistence that the telco is worth more. €1 billion more, to be precise. Clearly its fellow shareholders disagree.

Pinning a valuation to a challenger telco is always a tricky business, and the fact that the deal was brokered during a global pandemic only adds to the complexity of the calculation. But whatever its true worth (the answer to that normally being ‘whatever someone is willing to pay’), there can be no argument that Másmóvil is in a strong position in Spain.

Regulatory body the CNMC published new statistics this week that show Másmóvil captured way more than its fair share of market growth, even as the sector began to stagnate during the lockdown period.

As expected, churn plummeted in Spain in the spring. Close to 133,000 mobile users took their number to a new provider in April, down 76% on the same month in 2019, while just over 13,000 fixed numbers were ported, a decline of almost 93% on-year. Másmóvil gained a net 12,840 mobile customers, almost twice as many as Vodafone, the only other mobile network operator to report a positive portability figure. The disparity was even more stark on the fixed-line side, where Másmóvil gained close to 26,000 customers to Vodafone’s 3,000, with Telefonica’s Movistar and Orange again posting losses.

According to the CNMC, Másmóvil’s mobile market share stood at 13.86% at the end of April, a figure that does not include Lycamobile, the MVNO with around 1.5 million customers it acquired this summer. It has some way to go before it is in real contention with the big three, but they need to pay attention: Másmóvil is no longer a minnow.