America Movil’s secures a 21% stake in Dutch KPN

Mexican telecommunications group America Movil SAB de CV (NYSE:AMX) announced it had reached a 20.92% ownership level in Royal KPN NV (AMS:KPN) after buying further shares of the Dutch telecommunications and ICT services provider in a number of transactions.

Following these deals, including 27 transactions outside regular market trading, AMX holds 299.52m KPN ordinary shares, the buyer said. The Mexican group paid prices ranging from EUR7.51 (USD9.44) to EUR7.70 a share for the additional KPN stock, it said.

AMX is carrying out a EUR8.00 per share partial offer aimed at securing a stake of 27.7% in KPN. The company, which held 4.8% in KPN before launching the partial offer on 30 May, said the EUR2.6bn bid would stay open for acceptance until 27 June, unless extended.

With this move, the Mexican telecom wants to expand outside the Americas, betting on geographic diversification as key to its growth after it had so far provided it with increased profit and cash flow stability as well as strong ratings, it has said.

Meanwhile, KPN’s management and supervisory boards, reiterated their advice to shareholders against the offer which they deemed opportunistic and undervaluing the company’s potential.

As alternative to the bid, the boards looked into options to sell German mobile business E-Plus and create shareholder value superior to AMX’ offer. This process, however, failed to lead to a deal, with KNP blaming the outcome on “adverse” financial markets conditions. However, KPN said the process had revealed potential significant synergy value via in-country consolidation in Germany.

The Dutch group also plans to start in July the sale of its KPN Group Belgium (BASE) unit, after completing the review of this business, saying it would use the funds from the sale to boost its credit profile and financial position.

For AMX, this is its largest investment in Europe so far, it has said, adding it would use own cash resources to finance it.

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Mexico’s America Movil continues building a stake in Dutch KPN

Mexican telecommunications group America Movil SAB de CV (NYSE:AMX) said it had bought further 3.7m shares of Royal KPN NV (AMS:KPN) in a transaction outside regular market trading and raised its stake in the Dutch telecommunications and ICT services provider to 8.12%.

The additional stock was bought at a price per share of EUR7.90 (USD9.95), AMX said.

The Mexican group is currently carrying out a EUR2.6bn partial offer aimed at increasing its KPN stake to 27.7%. AMX, which had 4.8% in KPN before launching the partial offer on 30 May, has said that the EUR8.00 a share bid will run until 27 June, unless extended.

AMX is using this deal to expand outside the Americas, as it views geographic diversification to be key to its growth after it had so far provided it with increased profit and cash flow stability as well as strong ratings, it has said.

KPN’s management and supervisory boards, however, deemed the offer opportunistic and undervaluing the company’s potential and had advised shareholders not to tender their stock to it.

Arguing against the offer, the boards said that it fails to reflect the value derived from KPN’s current transition of its Dutch business and its profitable growth in Germany and Belgium.

As an alternative, the Dutch group’s boards have proposed to start a strategic review of the company’s German business E-Plus in addition to the ongoing review of its Belgian mobile operations, as they expect such a move to unlock superior value for shareholders.

The deal is AMX’s largest investment in Europe so far, it has said, adding it would use own cash resources to finance a deal.

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