America Movil Buys 21% Stake in Telekom Austria
06/15/2012| 08:01am US/Eastern
By Nicole Lundeen
America Movil SAB (AMX), Latin America's largest wireless service provider, Friday secured its second large-scale acquisition in Europe, saying it will buy a 21% stake in Telekom Austria AG (TKA.VI) giving it a doorway into central and eastern Europe.
The acquisition comes hard on the heels of the company's 2.6 billion euro ($3.28 billion) bid for a 27.7% stake in the Dutch phone company Royal KPN NV (>> KPN KON).
The latest stake in Telekom Austria will give the Mexican company a 23% holding in total by the end of 2012, making American Movil the second-largest shareholder after Austrian state holding company Oesterreichische Industrie Holding AG, which holds 28.42%.
America Movil, which already holds a 1.7% in Telekom Austria, made a deal with investor Ronny Pecik to buy his 21% stake in the operator. A 5% stake is being acquired immediately, with the remaining 16% subject to regulatory approval. Mr. Pecik holds his shares directly and indirectly via his company RPR Privatstiftung.
America Movil, owned by billionaire Carlos Slim, has 246 million mobile subscribers in 18 countries. Its expansion within the Americas has given it stable profits and cash flow and it is looking to widen its footprint further.
Austria Telekom is Austria's largest telecommunications company with operations in Belarus, Bulgaria, Croatia, Slovenia and Serbia.
Financial details of the latest transaction weren't given, but at Thursday's closing price of 8.03 euros a share. 21% stake would be worth about EUR7 million. One analyst estimated America Movil may have paid closer to 9.5 euros a share.
America Movil said it wants to be a long-term strategic partner of Telekom Austria.
"It is part of [our] geographic diversification strategy and provides an attractive presence in Central and Eastern Europe," it said.
Pecik was elected to Telekom Austria's supervisory board just a few weeks ago at the end of May and maintained at the time that he was a long-term shareholder.
Telekom's Chief Executive Hannes Ametsreiter said America Movil's substantial holding was a positive step for the company.
"As a strategic and long-term investor, the company with its know-how and knowledge of the industry will contribute to our company's economic success," he said.
At 1107 GMT, Telekom Austria's share were trading 1.9% higher at 8.19 euros.
Write to Nicole Lundeen at email@example.com
Stocks mentioned in the article : KPN KON